Knotty Company sells desks at $480 per desk.The variable costs are $372 per desk.Total fixed costs for the period are $456,840.The break-even volume in dollars is ________.
A)$456,840
B)$1,573,560
C)$2,030,400
D)none of these answers is correct

Question

Quizplus · Accepted Answer

Break-even point in units= Fixed costs/ (Price per unit - Variable costs per unit)

Break-even point in units= $456,840/($480-$372)= 710 units

Break-even point in dollars= Break-even point in units x Price per unit
Break-even point in dollars= 710 x $480= $340,800

Therefore, the break-even volume in dollars is $340,800 or option C.

Knotty Company Sells Desks at $480 Per Desk