Question

A company manufactures and sells a product for $124 per unit. The company's fixed costs are $72,760, and its variable costs are $94 per unit. The company's break-even point in units is:

Answer 1

The break even point in units is 2,425.33.

Step-by-step explanation:

The break even point is how many units you have to sell to pay the fixed costs. The selling price per unit is 124 and the cost per unit is 94. The contribution margin is 124-94 = 30. This means that per every unit you sell, you have $30 for paying the fixed costs. So, the total units for paying all the fixed costs are 72,760/30 = 2,425.33.