Question

Karlik Enterprises distributes a single product whose selling price is $27 per unit and whose variable expense is $21 per unit


 Karlik Enterprises distributes a single product whose selling price is $27 per unit and whose variable expense is $21 per unit. The company's monthly fixed expense is $24,000. 

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Answer #1

Break-even point in unit sales = Fixed expense / Contribution per unit

Contribution per unit = Selling price – Variable cost per unit

= 27 - 21

= $ 6 per unit

Therefore, Break-even point in unit sales = 24,000 / 6

= 4,000 units

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