# Calculate costs and break even

The Rolling Creek Textile Mill produces denim. The fixed monthly cost is $21,000 and the variable cost per yard of denim is $0.45. The mill sells a yard of denim for $1.30.

a. For a monthly volume of 18,000 yards of denim, determine the total cost, total revenue, and profit.

b. Determine the annual break-even volume for the Rolling Creek Textile Mill.

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#### Solution Preview

(a) Total cost = Fixed cost + Variable cost = 21000 + 0.45 * 18000 = $29100

Total revenue ...

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