Ask Question
9 March, 10:47

Stone Corporation is a manufacturing company that makes small electric motors it sells for $45 per unit. The variable costs of production are $25 per motor, and annual fixed costs of production are $800,000. How many units of product must Stone make and sell to break even?

+4
Answers (1)
  1. 9 March, 12:36
    0
    40,000 units

    Explanation:

    Given that,

    Selling price per unit = $45 per unit

    Variable cost per unit = $25

    Fixed cost = $800,000

    Contribution margin per unit:

    = Selling price per unit - variable cost per unit

    = $45 - $25

    = $20

    Break - Even units:

    = Fixed cost : Contribution margin per unit

    = $800,000 : $20

    = 40,000 units

    Therefore, the Break - Even sales in units are 40,000.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Stone Corporation is a manufacturing company that makes small electric motors it sells for $45 per unit. The variable costs of production ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers