Product ABC sells for $50 per unit. The contribution margin per unit for ABC is $14. Total monthly fixed costs are estimated to be $91 000. The monthly break-even units for this product will be:

Question

Quizplus · Accepted Answer

The break-even point (BEP) can be calculated as follows:

BEP (in units) = Fixed Costs / Contribution Margin per Unit

Plugging in the given values:

BEP = $91,000 / $14

BEP = 6,500 units

Therefore, the monthly break-even units for this product will be 6,500.

Product ABC Sells for $50 Per Unit