Question

Assume that Randy’s photocopying Service charges $.10 per photocopy. If fixed costs are

$27000 a year and variable costs are $0.04 per copy.

1. How Randy can compute his breakeven point? Show the result in graph.

2. How many photocopies are required to earn $ 500 profit?

3. Identify the safety margin at breakeven point.

Answer 1

1) 739 copies (739.7260273972603).

2) 5000 copies.

Step-by-step explanation:

27000/365 = 73.97260273972603 (Their daily wins). How much times $.10 is equal to 73.97260273972603?

I used a two step equation to get it.

• 0.10 * x = 73.97260273972603
• /0.10 = /0.10
• x = 739.7260273972603

They need to sell 739.7260273972603 copies a day to get 27000$ a year.

an equation (y = mx+b) can be

y = 739.7260273972603x

To earn a 500$ profit we need to do the same two-step equation but instead of 73.97260273972603 use 500.

• 0.10 * x = 500
• /0.10 = /0.10
• x = 5000

5000 copies needs to be sold to get a 500$ profit.

The last question I don't understand but I hope those 2 questions helped