What is the breakeven point in dollars for Zippy Dippy Swimwear, makers of bathing suits and accessories? They have the following costs:
The price of each suit is $85.
The price of each towel is $25.
The price of each umbrella is $40.
The price of each cover-up is $81.
A) $3,172,024
B) $4,947,196
C) $7,887,259
D) $6,425,583

Question

What is the breakeven point in dollars for Zippy Dippy Swimwear, makers of bathing suits and accessories? They have the following costs: 
The price of each suit is $85.
The price of each towel is $25.
The price of each umbrella is $40.
The price of each cover-up is $81.
A) $3,172,024 
B) $4,947,196 
C) $7,887,259 
D) $6,425,583

Quizplus · Accepted Answer

Solution:
Add all fixed costs:
150,000 + $196,000 + 230,000 + 550,000 = $1, 126,000
Determine all variable costs:
25 + 8 + 16 + 37 + 18 + 10 + 3 + 20 + 12 = 149
Determine the selling price of the product line:
85 + 25 + 40 + 81= 231
Determine the sales line's breakeven point:
1,126,000 / (231 - 149) = 13,731.70
Breakeven point in sales dollars $23,487.8 X 231 = $3,172,024

What Is the Breakeven Point in Dollars for Zippy Dippy