Given the Following Data, Determine the Break-Even Point in Units

question 183

Multiple Choice

Given the following data, determine the break-even point in units: Total fixed cost = $120,000
Variable cost per unit = $0.60
Selling price per unit = $1.10

• A) 100,000
• B) 240,000
• C) 200,000
• D) 218,182
• E) 50,000

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Definitions:

Raw Material Inventory

The total stock of basic materials awaiting processing into finished goods within a manufacturing or production facility.

Finished Goods Inventory

The stock of completed products that are ready to be sold but have not yet been sold.

Predetermined Overhead Rate

A rate used to allocate overhead costs to products or services, based on estimated costs and activity levels.

Applied Overhead

Costs related to production that are not directly tied to a specific product but allocated based on a formula or measure.