Production Costs for Manufacturing T-Shirts Consist of a Fixed Cost

question 76

Multiple Choice

Production costs for manufacturing T-shirts consist of a fixed cost of $18,000 plus variable costs of $2 per shirt. Each T-shirt sells for $8 dollars. How many T-shirts must be sold for the company to break even?

• A)2,250
• B)3,000
• C)9,000
• D)5,625

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Definitions:

Debt Investments

Investments made by purchasing bonds or other debt instruments, typically generating income from interest payments.

Interest Income

Income earned by an individual or entity from various types of investments that pay interest, such as savings accounts, bonds, or loans provided to others.

Income Tax Write-Off

An income tax write-off refers to a deduction that lowers a person's or entity's taxable income, reducing the tax owed by recognizing expenses or losses.