Explore BrainMass

Explore BrainMass

    Determining Break-Even Point: Example Problem

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    Sentry Corporation's income statement for last year appears below:

    Sales.................................................. $1,500,000.00
    Cost of Sales:
    Direct Materials.................$250,000.00
    Direct Labor (variable)..........$150,000.00
    Variable Overhead..............$75,000.00
    Fixed Overhead..................$100,000.00 $575,000.00
    Gross Margin.............................. $925,000.00
    Selling, General, and Administrative:
    Variable...........................$200,000.00
    Fixed...............................$250,000.00 $450,000.00
    Net Operating Income................... $475,000.00

    The break-even point last year was:

    A) $146,341.00

    B) $636,364.00

    C) $729,730.00

    D) $181,818.00

    © BrainMass Inc. brainmass.com June 3, 2020, 11:19 pm ad1c9bdddf
    https://brainmass.com/business/income-statement/break-even-point-example-problem-273804

    Solution Summary

    The solution computes the break-even point through an income statement.

    $2.19

    ADVERTISEMENT