The cost of producing respectively device is $267.Fixed cost is $202000. Sell price is $772. What's the brk even rev?
Answers:
Let b be the break even within unit.
B/e surrounded by revenue = 772b
Variable cost to produce b unit = 267b, and fixed cost is 202,000. Total cost is inconsistent cost plus fixed cost.
B/e contained by revenue 772b = total cost i.e. 267b + 202,000
772b - 267b = 202,000
505b = 202,000
b = 400, so break even occur at 400 units
Break even revenue = 400 x 772 = $308,800
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