How many products does the company have to sell to achieve break-even point?

Company A sells a product for $100. The total unit variable costs are $60. Fixed costs as in its ac-count are $20,000.

How many products does the company have to sell to achieve break-even point?
A . 600
B. 550
C. 400
D. 500

View Answer

Answer: D

Explanation:

Break even point = Fixed costs/(Price-variable cost). In this case, break even point = 20,000/(100-60) = 500

Reference: CIPS study guide page 28-29

LO 1, AC 1.2