Sizzling Company, a producer of salsa, has the following information: $$\begin{array} { l r }
\text { Income tax rate } & 30 \% \
\text { Selling price per unit } & \$ 5.00 \
\text { Variable cost per unit } & \$ 3.00 \
\text { Total fixed costs } & \$ 90,000.00
\end{array}$$ The break-even point in dollars is _____.
A)$150,000
B)$180,000
C)$225,000
D)$270,000

Question

Sizzling Company, a producer of salsa, has the following information: $$\begin{array} { l r } 
\text { Income tax rate } & 30 \% \
\text { Selling price per unit } & \$ 5.00 \
\text { Variable cost per unit } & \$ 3.00 \
\text { Total fixed costs } & \$ 90,000.00
\end{array}$$ The break-even point in dollars is _____.
A)$150,000
B)$180,000
C)$225,000
D)$270,000

Quizplus · Accepted Answer

Break-even point = Fixed costs / (Selling price per unit - Variable cost per unit)= 90,000 / (5.00 - 3.00)= 90,000 / 2.00= $225,000

Sizzling Company, a Producer of Salsa, Has the Following Information