Question

The neighbourhood bookstore sells novels for $20 per unit. The cost to purchase one book is $10 The store has fixed costs per month of $2000 The store estimates that they can sell 300 books each month (a) Compute the break-even point in units (b) Compute the break even point in sales dollars (c) Compute the break-even point as a percent of capacity (a) The break-even point in units is books (Simplify your answer) (b) The break-even point in sales dollars is $ (Simplify your answer.) (c) The break-even point as a percent of capacity is (Round to two decimal places as needed)

Answer 1

Solution : 0 (1) Given that Selling Pricee Pere Unet = $ 20 Variable cast pere Unit = $10 casts Per Unit = $ 2000 C-stimated capacity booke Fixed = 300 books la Break even units Fined costs Selling Price per unët – variable cost perunit 2000 s 20-10 2000 10 - 200 unity and (b) Break even point y sales dollars - fixed points contribution pargins rete contre butions Maregens serving počeo per unit- Varescable cost per voit, s 20-10 s $10 contribution. Morgens contribution Margine Rates selling price per unit 01 = 50.10 5 0.5olo

.: Break-even. pornt in sales dollores 2000 Oos- s yooo Ans of capacity pericentage (c) Break even point os Break even units xico Estimated capawty 200 x 100.1 M 66.6 / An in

3 Given that Sales - 2520 000 Poned cost-185000 Fotar vare able cost 1260000 Jotal cost 1445000 Net income - 1075-000 sales Variables coste contre bie tion S 12 60000 2520000 1260 000 contorcebution reaktion reate s boy treľbeetroom sales contribu ve te on 1260000 7520000 0.5 socon treo be from rate = rodo fixed cost Break even points in Dollares is contribution Margon ratio 185000 5-0 % $370,000 are