Longstreet Inc.has fixed operating costs of $670,000,variable costs of $2.75 per unit produced,and its product sells for $3.95 per unit.What is the company's break-even point,i.e. ,at what unit sales volume would income equal costs?
A) 558,333
B) 491,333
C) 686,750
D) 653,250
E) 446,667

Question

Quizplus · Accepted Answer

Break-even point = Fixed costs / (Selling price per unit - Variable cost per unit)= 670,000 / (3.95 - 2.75)= 670,000 / 1.20= 558,333 units