The Wingo Company sells a single product for $21 per unit.If variable expenses are 70% of sales and fixed costs are $4,200, the break-even point in dollars will be:

Question

Quizplus · Accepted Answer

The break-even point in dollars can be calculated using the formula: Break-even point = Fixed Costs / (1 - Variable Cost Ratio). Here, the Variable Cost Ratio is 70% or 0.7 of sales, so 1 - 0.7 = 0.3. Therefore, the break-even point = $4,200 / 0.3 = $14,000.

The Wingo Company Sells a Single Product for $21 Per