Q260
A company makes a single product and incurs fixed costs of Rs 30,000 per annum. Variable cost per unit is Rs 5 and each unit sells for Rs 15. Annual sales demand is 7,000 units. The breakeven point is:
A.
2,000 units
B.
3,000 units
AnswerC.
4,000 units
D.
6,000 units
Answer: Option B
Solution
Answer: Option B
Solution:
Break-Even Point (Units) = Fixed Costs ÷ (Revenue per Unit – Variable Cost per Unit) = 30000 ÷ (15 - 5)
= 3000 units.