Question

9) JKE, Inc. has a break even sales level of $8,000,000 and has fixed costs of $3,000,000 per year. The selling price per unit is $100. What is the variable cost per unit?

Answer 1

Variable cost per unit	=	Total variable cost	/	Total units sold
	=	$ 50,00,000.00	/	80,000
	=	$ 62.50
Working:
Total variable cost	=	Total costs	-	Total fixed costs
	=	$ 80,00,000.00	-	$ 30,00,000.00
	=	$ 50,00,000.00
Units sold	=	Break even sales	/	Sales price per unit
	=	$ 80,00,000.00	/	$             100.00
	=	80,000