The Flint Fan Corporation is considering the addition of a new model fan, the F-27, to its current products. The expected cost and revenue data for the F-27 fan are as follows:

If the F-27 is added as a new product, it is expected that the contribution margin of other products will drop by $7,000 per year.
-At what selling price would the new product be just breaking even?
A)$52.25 per unit
B)$50.50 per unit
C)$55.75 per unit
D)$49.00 per unit

Question

The Flint Fan Corporation is considering the addition of a new model fan, the F-27, to its current products. The expected cost and revenue data for the F-27 fan are as follows:

If the F-27 is added as a new product, it is expected that the contribution margin of other products will drop by $7,000 per year. 
-At what selling price would the new product be just breaking even?
A)$52.25 per unit 
B)$50.50 per unit 
C)$55.75 per unit 
D)$49.00 per unit

Quizplus · Accepted Answer

The break-even price is calculated by dividing the total fixed costs by the difference between the selling price per unit and the variable cost per unit. Without specific cost details, the correct choice is typically provided in the question context.

The Flint Fan Corporation Is Considering the Addition of a New