# Maxson Products break-even using equation method

Maxson Products distributes a single product, a woven basket whose selling price is $8 and whose variable cost is $6 per unit. The company's monthly fixed expense is $5,500.

Required:

Solve for the company's break-even point in unit sales using the equation method.

Solve for the company's break-even point in sales dollars using the equation method and the CM ratio.

Solve for the company's break-even point in unit sales using the contribution margin method.

Solve for the company's break-even point in sales dollars using the contribution margin method and the CM ratio.

https://brainmass.com/business/financial-ratios/maxson-products-break-even-using-equation-method-cm-ratio-contribution-margin-232033

#### Solution Preview

Solve for the company's break-even point in unit sales using the equation method. The equation method yields the break-even point in unit sales, Q, as follows:

Sales = Variable expenses + Fixed expenses + Profits

$8Q = $6Q + $5,500 + $0

$2Q = $5,500

Q = $5,500 ÷ $2 per basket

Q = 2,750 baskets

Solve for the company's break-even point in sales ...

#### Solution Summary

Maxson Products break-even using equation method are analyzed. The break-even point is discovered.