Bruno's Bakery sells gourmet cupcakes for $5. The variable cost per cupcake is currently $3 and fixed costs are $10,000. What is Bruno's breakeven point?
A) 6500 units
B) 5000 units
C) 4500 units
D) 2000 units

Question

Quizplus · Accepted Answer

The breakeven point is calculated by dividing the total fixed costs by the contribution margin per unit (selling price per unit minus variable cost per unit). Here, it is $10,000 / ($5 - $3) = 5000 units.

Bruno's Bakery Sells Gourmet Cupcakes for $5