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Jingle Corporation produces toy footballs. Each football sells for $9.95 with a variable unit cost of $7.10. Assuming a fixed cost of $11,400 what is Jingle's breakeven point?

Respuesta :

Noah11012
Each football is sold for $9.95. To make one of these football costs $7.10.
There is a profit of $2.85. Divide 11,400 by 2.85 to see how many footballs would have to sell to break even.

11,400 / 2.85 = 4000. 

4000 footballs would have to be sold to break even.
raphealnwobi

Jingle's breakeven point is achievable if 4000 units are sold.

Let x represent the number of units sold.

Total cost = fixed cost + variable cost

Total cost = 11400 + 7.1x

The revenue = selling price per unit * number of units

Revenue = 9.95 * x = 9.95x

At breakeven point, revenue = total cost, hence:

9.95x = 11400 + 7.1x

2.85x = 11400

x = 4000 units

Therefore Jingle's breakeven point is achievable if 4000 units are sold.

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