A fiRm Is Considering a Project with a Cash Break-Even

question 250

Multiple Choice

A firm is considering a project with a cash break-even point of 13,500 units. The selling price is $13 a unit and the variable cost per unit is $7. What is the projected amount of fixed costs?

• A) $64,000
• B) $70,500
• C) $74,500
• D) $78,000
• E) $81,000

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Definitions:

Perishable Products

Goods that deteriorate over a short period or have a limited shelf life, requiring timely sale and use.

Credit Periods

The length of time that a lender or supplier allows for payment after a purchase or loan is made.