Hollis Company sells a single product for $20 per unit. The company's fixed expenses total $240,000 per year, and variable expenses are $12 per unit of product. The company's break-even point is:
1. 12,000 units
2. 20,000 units
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The break-even number of units=Fixed Costs/(Sales Price per unit-Variable Cost Per Unit), or $240,000/($20-$12). This ...
This solution describes the formulas to determine the break-even point in both sales units and sales dollars.