Data concerning Sinisi Corporation's single product appear below: The break-even in monthly unit sales is closest to:
A) 2,038 units
B) 7,027 units
C) 2,870 units
D) 3,978 units

Question

Data concerning Sinisi Corporation's single product appear below:  The break-even in monthly unit sales is closest to:
A) 2,038 units 
B) 7,027 units 
C) 2,870 units 
D) 3,978 units

Quizplus · Accepted Answer

First, we need to calculate the contribution margin per unit, which is selling price per unit minus variable cost per unit.
Contribution margin per unit = $120 - $62 = $58
Next, we can use the formula below to calculate the break-even point in monthly unit sales:
Break-even point = Fixed expenses ÷ Contribution margin per unit
Break-even point = $179,600 ÷ $58 = 3,093 units
Therefore, the closest answer is C) 2,870 units.

Data Concerning Sinisi Corporation's Single Product Appear Below: the Break-Even