Your Memory Lane produces custom-made art prints that include graphics and icons to celebrate life's special moments.For example,on his wedding anniversary,David had an art print produced that celebrated highlights of his ten years with his wife,Kathy.Suppose that Your Memory Lane sells the custom artwork for $500.It estimates its average variable costs to be $200 per unit produced.It figures its fixed costs to be $900,000 per year.How many prints does it have to sell to break even?
A) 2,000 prints
B) 1,200 prints
C) 3,000 prints
D) 2,500 prints
E) 6,000 prints

Question

Quizplus · Accepted Answer

Break-even quantity equals the total fixed costs ($900,000)divided by the fixed cost contribution per unit ($500 - $200 = $300).

Your Memory Lane Produces Custom-Made Art Prints That Include Graphics