You own a company that manufactures and sells widgets. Your sales for last year were $100,000. Each widget sells for $8.50. The cost of material for each widget is $4.00 and last years labor cost was $285,000.00. The fixed costs for the operation are $185,000. What is the break-even in widgets and dollars.
If we divide $100,000 sales by 8.5 we get the number of widgets sold = 11764.70 and if we assume the labor cost to be variable we get a per widget ...
The break-even in widgets and dollars is determined.