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Santana sells a product for $115 per unit. The variable cost is $75 per unit, while fixed costs are $65,000. Determine (a) the break-even point in sales units and (b) the break-even point if the selling price were increased to $125 per unit. a. Break-even point in sales units fill in the blank 1 units b. Break-even point if the selling price were increased to $125 per unit

Answer :

TUTORANNEGO

The break even point when sales is $115 per unit is 1,625units and 1,300 units when sale price increases to $125

Finding Break even Point.

  • Break-even point in sales units:

     = Fixed costs ÷ (Selling price per unit - Variable cost per unit)

     = $65,000 ÷ ($115  -$75 )

      =  1625units

  • Break-even point in sales units when selling price becomes $125

         = Fixed costs ÷ (Selling price per unit - Variable cost per unit)

         = $65,000 ÷ ( $125 -$75 )

          =  1300units

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