Baker Company sells its product for $60.In addition, it has a variable cost ratio of 40 percent and total fixed costs of $9,000.What is the break-even point in sales dollars for Baker Company?

Question

Quizplus · Accepted Answer

The break-even point can be calculated using the formula: 
Break-even point = Fixed costs / (1 - Variable cost ratio)
= $9,000 / (1 - 0.4)
= $15,000
Therefore, the break-even point in sales dollars for Baker Company is $15,000. Option C is the correct answer.

Baker Company Sells Its Product for $60