The Motor Works Is Considering an Expansion Project with Estimated

question 84

Multiple Choice

The Motor Works is considering an expansion project with estimated annual fixed costs of $71,000,depreciation of $38,500,variable costs per unit of $17.90 and an estimated sales price of $26.50 per unit.How many units must the firm sell to break-even on a cash basis?

• A)6,521 units
• B)8,256 units
• C)8,510 units
• D)9,667 units
• E)10,842 units

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Definitions:

Unilateral Contract

A contract formed when one party performs what has been requested by the other party; there is a promise followed by an act, but not an exchange of promises.

Lost Dog

A canine that has gone missing from its owner's home or care.

Groceries

Items of food and other household necessities purchased for consumption and use within the home.

Dickinson V. Dodds

A landmark case in contract law, dealing with the revocation of offers.