Question

# Break-Even Sales Currently, the unit selling price of a product is \$230, the unit variable cost...

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 \$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

 Current Proposed Sales Per unit \$           230.00 \$           260.00 Less :- Variable Cost \$           190.00 \$           190.00 Contribution \$             40.00 \$             70.00 Fixed Cost \$ 4,20,000.00 \$ 4,20,000.00 10500 6000 Break Even point for Unit Sales:- Fixed cost / Contribution Current break-even sales (units) 10500 anticipated break-even sales (units) 6000

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