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    ajtrack84's Avatar
    ajtrack84 Posts: 7, Reputation: 1
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    #1

    Feb 3, 2008, 06:58 PM
    Break even point
    Selling Price = $8, variable cost per unit= $5, fixed costs= 48,000

    Break Even Point in units=

    Break Even Point in dollars=
    MaggieMouse's Avatar
    MaggieMouse Posts: 226, Reputation: 8
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    #2

    Feb 3, 2008, 11:03 PM
    When the revenue equals all costs, it breaks even.

    You can use the formular in your managerial accounting book, but you can also use simple math:
    $8 X=$5X+$48,000, --->X=16,000 units, check back to see if it is correct: $8*16,000=$5*16,000+$48,000

    Amount from either side of the equation is the break even sales dollars.
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