If fixed costs are $600,000 and the unit contribution margin is $40, what is the break-even point if fixed costs are increased by $90,000?
A) 17,250
B) 15,000
C) 8,333
D) 9,667

Question

Quizplus · Accepted Answer

The break-even point is calculated by dividing the total fixed costs by the unit contribution margin. With the increase, fixed costs become $690,000. So, $690,000 / $40 = 17,250 units.

If Fixed Costs Are $600,000 and the Unit Contribution Margin