Question

Break-Even Sales

Currently, the unit selling price of a product is $230, the unit variable cost is $190, and the total fixed costs are $448,000. A proposal is being evaluated to increase the unit selling price to $260.

**a.** Compute the current break-even sales
(units).

units

**b.** Compute the anticipated break-even sales
(units), assuming that the unit selling price is increased to the
proposed $260, and all costs remain constant.

units

Answer #1

Break-even sales (Units) = Fixed Costs/ (Sales price per unit - Variable Costs per unit)

**a. Break-even Sales (Units) = 11,200 Units**

**Explanation**

Calculation of Break-even sales (Units)

Particulars |
Amount
($) |

Fixed Costs | 448,000 |

Selling Price per unit | 230 |

Variable cost per unit | 190 |

Break-even Sales Units
(448000/(230-190) |
11,200 |

**b. Break-even Sales (Units), if the selling price is $
260 per unit = 6,400 Units**

Calculation of Break-even sales (Units)

Particulars |
Amount
($) |

Fixed Costs | 448,000 |

Selling Price per unit | 260 |

Variable cost per unit | 190 |

Break-even Sales Units
(448,000/(260-190) |
6,400 |

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Currently, the unit selling price of a product is $230, the unit
variable cost is $190, and the total fixed costs are $420,000. A
proposal is being evaluated to increase the unit selling price to
$260.
a. Compute the current break-even sales
(units).
units
b. Compute the anticipated break-even sales
(units), assuming that the unit selling price is increased to the
proposed $260, and all costs remain constant.
units

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are $918,000. A proposal is being evaluated to increase the unit
selling price to $350.
a. Compute the current break-even sales (units). units
b. Compute the anticipated break-even sales (units), assuming
that the unit selling price is increased and all costs remain
constant. units

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Currently, the unit selling price of a product is $320, the unit
variable cost is $260, and the total fixed costs are $810,000. A
proposal is being evaluated to increase the unit selling price to
$350.
a. Compute the current break-even sales
(units).
units
b. Compute the anticipated break-even sales
(units), assuming that the unit selling price is increased and all
costs remain constant.
units

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unit.
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b. Break-even point if the selling price were
increased to $110 per unit
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