You are considering opening a copy service in thestudent union. You estimate your fixed cost at $15,000 and thevariable cost of each copy sold at $.01. You expect the sellingprice to average $.05.a) What is the break-even point in dollars?b) What is the break-even point in units? PX• • S7.23 An electronics firm is currently manufacturing anitem that has a variable cost of $.50 per unit and a selling priceof $1.00 per unit. Fixed costs are $14,000.
You are considering opening a copy service in thestudent union. You estimate your fixed cost at $15,000 and thevariable cost of each copy sold at $.01. You expect the sellingprice to average $.05.a) What is the break-even point in dollars?b) What is the break-even point in units? PX• • S7.23 An electronics firm is currently manufacturing anitem that has a variable cost of $.50 per unit and a selling priceof $1.00 per unit. Fixed costs are $14,000.
Chapter14: Capital Structure Management In Practice
Section14.A: Breakeven Analysis
Problem 7P
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Question
You are considering opening a copy service in the
student union. You estimate your fixed cost at $15,000 and the
variable cost of each copy sold at $.01. You expect the selling
price to average $.05.
a) What is the break-even point in dollars?
b) What is the break-even point in units? PX
• • S7.23 An electronics firm is currently manufacturing an
item that has a variable cost of $.50 per unit and a selling price
of $1.00 per unit. Fixed costs are $14,000.
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