What Is the Breakeven Point, in Dollars, for Zippy Dippy

question 5

Multiple Choice

What is the breakeven point, in dollars, for Zippy Dippy Swimwear, maker of bathing suits and accessories? It has the following costs: $\begin{array}{ll}\text { Raw materials: } & \$ 25 \text { per bathing suit } \\& \$ 8 \text { per towel } \\& \$ 16 \text { per beach umbrella } \\& \$ 37 \text { per swimsuit cover-up }\\\text { Labor costs: } & \$ 18 \text { average per suit } \\& \$ 10 \text { per umbrella } \\& \$ 3 \text { per towel } \\& \$ 20 \text { per cover-up }\\\text { Commissions: } & \$ 12 \text { per item } \\\text { Utilities: } & \$ 150,000 \\\text { Rent: } & \$ 196,000 \\\text { Taxes: } & \$ 230,000 \\\text { Salaries: } & \$ 550,000\end{array}$ The price of each suit is $85. The price of each towel is $25.
The price of each umbrella is $40.
The price of each cover-up is $81.

• A) $3,172,023
• B) $4,947,196
• C) $7,887,259
• D) $6,425,583

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