BreakEven Revenue in dollars:
The correct option is
Explanation:
BreakEven Revenue ($)
= Fixed costs ÷ contribution margin ratio
Given
fixed costs = $1000
Selling price = $30
Variable cost = $10
That implies,
Contribution margin ratio
= Contribution margin ÷ Selling price
= (selling price - variable cost) ÷ selling price
= ($30 - $10) ÷ $30
= $20 ÷ $30
= 0.6666
= 66.67%
Now,
Break Even Revenue ($)
= fixed costs ÷ Contribution margin ratio
= $1000 ÷ 66.67%
= $1500
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