Question

A company manufactures and sells a product for $120 per unit. The company's fixed costs are $68,760, and its variable costs are $90 per unit. The company's break-even point in dollars is:

Answer 1

Break-even point (dollars)= $275,040

Step-by-step explanation:

Giving the following information:

Selling price per unit $120

Variable cost per unit $90

Fixed expense per month $68,760

To calculate the break-even point in dollars, we need to use the following formula:

Break-even point (dollars)= fixed costs/ contribution margin ratio

Break-even point (dollars)= 68,760 / [(120 - 90)/120]

Break-even point (dollars)= $275,040