A lumber yard has fixed costs of $3077.80 a day and variable costs of $1.00 per board-foot produced. The company gets $2.10 per board-foot sold. How many board-feet must be produced
Daily to break even?
A)1865 board-feet
B)3077 board-feet
C)992 board-feet
D)2798 board-feet

Question

Quizplus · Accepted Answer

To break even, the total cost must equal total revenue. The total cost is the sum of fixed costs ($3077.80) and variable costs ($1.00 per board-foot). The revenue is $2.10 per board-foot. Setting up the equation: $3077.80 + $1.00x = $2.10x, solving for x gives x = 2798 board-feet.

A Lumber Yard Has Fixed Costs of $3077