The owner of a small restaurant that sells take-out fried chicken spends monthly amounts of $2,500 in rent, $500 in utilities, $750 in loan interest, $200 in insurance premium, and $250 for advertising on local buses.A bucket of take-out chicken is priced at $9.50.Unit variable costs for the bucket of chicken are $5.50. How many buckets of chicken does the restaurant need to sell to break even?
A)988
B)1,000
C)1,050
D)3,150

Question

Quizplus · Accepted Answer

The break-even point is calculated as fixed costs divided by unit price minus unit variable costs.Here, fixed costs total $2,500 + $500 + $750 + $200 + $250 = $4,200.Thus the break-even point = $4,200 F1F1F1S1F1F1F10 ($9.50 - $5.50), which equals 1,050 buckets of chicken.

The Owner of a Small Restaurant That Sells Take-Out Fried