I am an analyst in the office of financial operations for a manufacturing firm that produces a single product. I have developed the following cost structure information for this company. All of it pertains to an output level of 10 million units.
Using this information, find the break-even point in units of output for the firm.
Return on operating assets = 25%
Operating asset turnover = 5 times
Operating assets = $20 million
Degree of operating leverage = 4 times
Please show work so that I can understand how the numbers are achieved.© BrainMass Inc. brainmass.com February 24, 2021, 6:31 pm ad1c9bdddf
This solution assists with determining the break-even point int he units of output for the given firm.