Question

Data concerning Wang Corporation's single product appear below: (Do not round your intermediate calculations.)

Selling price per unit $ 230.00
Variable expense per unit $ 75.90
Fixed expense per month $ 144,050
The break-even in monthly dollar sales is closest to:

$215,000

$285,950

$144,050

$430,000

Answer 1

Answer:

The break-even in monthly dollar sales is closest to $215,000

Explanation:

The break-even point is the level of production at which the costs of production equal the revenues for a product and calculated by using following formula:

Break-even point in units = Fixed expense/(Selling price per unit-Variable expense per unit) = $144,050/($230.00 - $75.90) = 935 units

The break-even in monthly dollar sales = 935 x $230.00 = $215,000