A one-machine shop producing bolts has a fixed cost of $\$ 2,000.00$ and a variable cost of $\$ 2.00$ per bolt. The selling price is $\$ 6.00$ per unit. The breakeven volume of production is
A) 1000
B) 500
C) 333.33
D) 250
E) none of the above

Question

Quizplus · Accepted Answer

The breakeven volume is calculated by dividing the fixed costs by the difference between the selling price per unit and the variable cost per unit. Here, it's \(\$2,000 / (\$6 - \$2) = \$2,000 / \$4 = 500 bolts.

A One-Machine Shop Producing Bolts Has a Fixed Cost Of $2,000.00\$ 2,000.00$2,000.00

A One-Machine Shop Producing Bolts Has a Fixed Cost Of $\$ 2,000.00$