Mignon d'Armitage manufactures jewelry. This firm is planning to introduce a new necklace and is trying to determine how many units it must sell in order to break even. Fixed costs are $100,000 and variable costs for each unit will be $20. At the price of $45 each, the number of units that must be sold in order to break even is:

Question

Quizplus · Accepted Answer

The break-even point in units can be calculated using the formula: Break-even point in units = Fixed Costs / (Selling Price per Unit - Variable Cost per Unit). Plugging in the given values: $100,000 / ($45 - $20) = $100,000 / $25 = 4,000 units.

Mignon D'Armitage Manufactures Jewelry