Maywood Company sells hand-knit scarves..Each scarf sells for $25.The company pays $30 to rent vending space for one day.The variable costs are $15 per scarf.How many scarves should the company sell each day in order to break even?

Question

Quizplus · Accepted Answer

To break even, the total revenue must equal total costs. The fixed cost is $30, and the variable cost per scarf is $15. The selling price per scarf is $25. The break-even point is calculated as: Fixed Costs / (Selling Price - Variable Cost) = $30 / ($25 - $15) = 3 scarves.

Maywood Company Sells Hand-Knit Scarves