The selling price of a widget is $15 and the fixed cost per month is $4,800. The variable cost per widget is $9. Calculate the revenue per month required to break-even.
A) $4,800
B) $7,200
C) $12,000
D) $14,400
E) $16,000

Question

Quizplus · Accepted Answer

To break-even, total revenue must equal total costs. The break-even point in units is calculated as Fixed Costs / (Selling Price - Variable Cost) = $4,800 / ($15 - $9) = 800 units. The revenue required is 800 units * $15 = $12,000.

The Selling Price of a Widget Is $15 and the Fixed