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At the break-even point of 2,000 units; variable costs are $165,000, and fixed costs are $96,000. How much is the selling price per unit?

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beritop1089

Answer:

$130.5

Explanation:

Breakeven point is defined as the production level at which total cost of production is equivalent to the revenues received for that good or service. The formula for breakeven point is as follows;

Breakeven units = 2,000

FC =  Fixed cost = $96,000

VC = Variable cost per unit = $165,000

Total cost = Fixed cost + variable cost = 96,000 +165,000 = $261,000

SP = Selling price per unit = $261,000 /2000

Selling price per unit  = $130.5

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