TNT Construction wants to sell dynamite for $50 a bundle. Its variable costs for each bundle...

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TNT Construction wants to sell dynamite for $50 a bundle. Its variable costs for each bundle...

TNT Construction wants to sell dynamite for $50 a bundle. Its variable costs for each bundle are $15. To break-even, TNT Construction needs to sell 500 bundles of dynamite. Calculate TNT Construction's fixed costs.

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Answer 1

Answer #1

FORMULA:
BEQ = FIXED COST / PRICE PER UNIT - VARIABLE COST

VARIABLE COST = 15
PRICE PER UNIT = 50

500 = FIXED COST / (50 - 15)
FIXED COST = 500 * (50 - 15) = 17500

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Answer 2

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TNT Construction wants to sell dynamite for $50 a bundle. Its variable costs for each bundle...

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