Problem:
Shock Electronics sells portable heaters for $25 per unit, and the variable cost to produce them is $17. Mr. Amps estimates that the fixed costs are $96,000.
a.) How do I compute the break-even point in units?
b.) How do I fill in the table below (in dollars) to illustrate that the break-even point has been achieved.
sales
fixed costs
total variable costs
net profit (loss)
Therapeutic Systems sells its products for $8 per unit. It has the following costs:
Rent $120,000
Factory labor $1.50 per unit
Executive salaries $112,000.
Raw material $.70 per unit
How do I seperate the expenses between fixed and variable costs per unit. And using this information and the sales per unit of $6, How do I compute the break- even point?