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    CVP Ananlysis

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    Assume a fixed cost of $900, a variable cost of $4.50, and a selling price of $5.50. What is the break even point? How many units must be sold to make a profit of $500.? How many units must be sold to average $.0.25 profit per unit? .50 per unit? $1.50 profit per unit?

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    Solution Preview

    Breakeven Point=Fixed Costs/(Price per unit- Variable Cost per unit)=900/(5.5-4.5)=900 units

    If the desired profit is $500
    Units needed to be sold=(Fixed Costs+ desired profit)/(Price per unit- Variable Cost per unit)

    Solution Summary

    The solution describes the steps to find out breakeven unit sales and sales necessary to meet a desired profit level.