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RSE Corporation Sells Its Product for $10 Per Unit

Question 156

Essay

RSE Corporation sells its product for $10 per unit. Its variable cost is $3 per unit and total fixed costs are $700. Calculate the following:
a)Breakeven sales in units
b)Margin of safety in units if RSE sells 150 units
c)Margin of safety in revenues if RSE sells 200 units
d)Estimated income or loss if RSE sells 75 units

Correct Answer:

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a)Breakeven sales = $700 / ($10 - $3)= 1...

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