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nassriano
Apr 21, 2013, 01:53 PM
"FIRED-UP" produce specialist fireworks which they sell at R 300 per box. Their fixed costs are R 20 000 and the variable cost of a box of a fireworks is R 50. What is their break-even production level?

teacherjenn4
Apr 21, 2013, 02:14 PM
We help with homework, but we won't do it for you. Post your attempt and then someone will come along to help you.

pready
Apr 22, 2013, 07:23 AM
Here is your formula:
PX = VX + FC

P = Unit Selling Price
V = Unit Variable Price
FC = Fixed Costs
X = Sales in Units

Just plug in your numbers and solve for X.

nassriano
Apr 22, 2013, 09:52 AM
Thanks
Pready !

your formula, helped me.

PX = VX + FC

P = Unit Selling Price
V = Unit Variable Price
FC = Fixed Costs
X = Sales in Units
solution
300x = 20000 + 50x
300x - 50x = 20000
250x = 20000(divide 250 both sides to get x)
x = 80
well done !