(15-1). Break-Even Quantity Shapland Inc. has fixed operating costs of $500,000 and variable costs of $50...

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(15-1). Break-Even Quantity Shapland Inc. has fixed operating costs of $500,000 and variable costs of $50...

(15-1). Break-Even Quantity
Shapland Inc. has fixed operating costs of $500,000 and variable costs of $50 per unit. If it sells the product for $75 per unit, what is the break-even quantity?

F =		$500,000
V =		$50
P =		$75

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business finance

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Answer 1

Answer #1

Calculate the break even quantity as follows:

Break even quantity = Fixed cost/(Price -Variable cost)

= $500,000/($75 - $50)

= $500,000/ $25

= 20,000

Therefore, the break even quantity is 20,000.

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Answer 2

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