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2 February, 10:44

If the unit sales price is $12, variable costs are $6 per unit, and fixed costs are $36,000, what sales volume (in dollars) is necessary to break-even?

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  1. 2 February, 12:46
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    72000

    Explanation:

    Break even formula:

    Break even in units=Fixed cost/Contribution margin per unit

    = $ 36,000 / $ 6

    = 6,000 Units

    [Contribution margin=Sales price-Variable cost=12-6]

    Break Even in Dollars = Break Even in Units * Selling Price Per Unit

    = 6,000 Units * $ 12 Per Unit = $ 72,000
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