Assume the following information: Variable cost ratio 80%
Total fixed costs $60,000
What volume of sales dollars is needed to break even?
A) $12,000
B) $48,000
C) $75,000
D) $300,000

Question

Quizplus · Accepted Answer

To find the break-even point in sales dollars, use the formula: Break-even sales = Total fixed costs / (1 - Variable cost ratio). Here, it is $60,000 / (1 - 0.80) = $300,000.

Assume the Following Information: Variable Cost Ratio 80