Assume a Fixed Cost for a Process of $15,000

question 49

Multiple Choice

Assume a fixed cost for a process of $15,000. The variable cost to produce each unit of product is $10, and the selling price for the finished product is $25. Which of the following is the number of units that has to be produced and sold to break even?

• A) 500 units
• B) 667 units
• C) 790 units
• D) 900 units
• E) 1,000 units

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Definitions:

Reclaim Goods

The process of taking back possession of sold goods by a seller under certain conditions, typically due to nonpayment or breach of contract.

Breach

The violation or failure to observe a legal agreement, law, or obligation.

Specific Performance

is a legal remedy in contract law where a court orders a party to perform their contractual duties, rather than simply paying damages for failing to fulfill the contract.

Seller

A seller is an individual or entity that offers goods or services for sale.