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Breaking-even points for decision modeling

A start-up publishing company estimates that the fixed costs of its first major project will be $190,000, the variable cost will be $18, and the selling price per book will be $34.

a) How many books must be sold for this project to break even?
b) Suppose the publishers wish to take a total of $40,000 in salary for this project. How many books must be sold to break even, and what is the break-even point, in dollars?

Solution Preview

a) number of books which are sold for this project to break even = Fixed Costs / Contribution margin = ...

Solution Summary

The solution gives detailed steps on calculating the number of books for the project to break even.

$2.19