break even analysis

fenil 12 April 2020 at 17:07 PM

Firm A has the following information with regard to the production and sales of product XIT. Selling price per unit is $15, total variable cost per unit is $9, and total fixed costs are $30,000. What is the breakeven revenue for XIT? a) $2,000 b) $5,000 c) $50,000 d) $75,000

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FACULTY 09 May 2020 at 01:31 PM

fixed cost = $30000

Contribution = sales - variable c

= 15-9

= 6

contribution margin = 6/15

=.4

break even revenue = fixed cost /contribution margin

3000

=30000/.4

=75000 (option d)