If unit sales prices are $7 and variable costs are $5 per unit,how many units would have to be sold to break-even if fixed costs equal $8,000?
A)2,000 units
B)3,000 units
C)4,000 units
D)3,800 units

Question

Quizplus · Accepted Answer

To find out the breakeven point, we need to use the following formula:
Breakeven point = Fixed Costs / (Unit Price - Variable Costs)

Substituting the given values, we get:
Breakeven point= 8000 / (7-5)
Breakeven point= 4000 units.

Therefore, the answer is C) 4,000 units.

If Unit Sales Prices Are $7 and Variable Costs Are