In 2012, Carow Sold 3,000 Units at $500 Each

question 71

Multiple Choice

In 2012, Carow sold 3,000 units at $500 each.Variable expenses were $250 per unit, and fixed expenses were $250,000.The same selling price is expected for 2013.Carow is tentatively planning to invest in equipment that would increase fixed costs by 20%, while decreasing variable costs per unit by 20%.What is Carow's break-even point in units for 2013?

• A)1,000
• B)1,200
• C)1,250
• D)1,500

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Definitions:

Pickup Truck

A vehicle with an enclosed cab and an open cargo area with low sides and tailgate.

Insurable Interest

A requirement for purchasing insurance, indicating the policyholder has a stake in the continued existence of the insured item or person that is subject to potential financial loss.

Risk Of Loss

Refers to the concept in commerce regarding which party bears the liability for goods damaged or destroyed during transportation or storage.

Goods In Bailment

Items that are temporarily placed under the care of another, who holds responsibility for the good's safekeeping.