Assume the following facts about a firm that sells just one product: $\begin{array}{l}
\text { Selling price per unit}&=\$ 24.00 \
\text { Variable costsper unit}&=\$ 18.00 \
\text {Total monthly fuxed costs }&=\$ 2,500
\end{array}$ What is the firm's monthly breakeven volume in units?
A) 417 units
B) 1,250 units
C) 5,000 units
D) 1,667 units

Question

Quizplus · Accepted Answer

The breakeven volume in units is calculated by dividing the total fixed costs by the contribution margin per unit (Selling price per unit - Variable costs per unit). Here, it is $2,500 / ($24 - $18) = 417 units.

Assume the Following Facts About a Firm That Sells Just