A fabric manufacturer is doing a breakeven analysis of oilcloth.It costs $15.00 to manufacture a metre of oilcloth.Customers will pay $25 a metre for oilcloth.The company's fixed costs are $10,000.The fabric manufacturer must sell which of the following number of metres to break even?
A) 1,000
B) 667
C) 10,000
D) 400

Question

Quizplus · Accepted Answer

To find the breakeven point, use the formula: Fixed Costs / (Selling Price per Unit - Variable Cost per Unit). Here, it's $10,000 / ($25 - $15) = 1,000 metres.

A Fabric Manufacturer Is Doing a Breakeven Analysis of Oilcloth