Problema Solution
A particular company produce widget.Each widget sells for 9$and the variable cost of each unit is 40%of selling price If the monthly fixed costs incurred by the company are 50000 What is the brek even point?
Answer provided by our tutors
let 'x' represent the number of widgets produced
Sale price = $9
Total sales for x widgets = 9x
Cost of production per widget =0.4*9= $3.60
the total cost = the total sales
50000+3.60x = 9x
by solving we find:
x= 9,259 widgets
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the break even point is 9,259 widgets.