You are considering opening a fast-food store.Your fixed costs for the required land,building,parking lot paving,kitchen equipment,and neon sign will be $1,000,000.The variable cost will be $1.89 for servings,which will sell for $2.89.How many servings must you sell to break even?
A)1,000,000
B)1,200,000
C)2,890,000
D)189,000
E)This cannot be determined with the information provided.

Question

Quizplus · Accepted Answer

The BEP,in units,can be found by dividing total fixed costs (TFC)by the fixed-cost (FC)contribution per unit.The fixed-cost (FC)contribution per unit is the assumed selling price per unit minus the variable cost per unit.

You Are Considering Opening a Fast-Food Store