Tim Marlow,the Owner of the Clock Works,wanted to Know How

question 258

Multiple Choice

Tim Marlow,the owner of The Clock Works,wanted to know how many clocks he must sell in order to cover his fixed cost at a given price.Tim knew that he had a fixed cost of $20,000 for equipment,taxes,and a bank loan.He also had a unit variable cost of $20 per clock for labour,materials,and promotional costs.If the price Tim charges for each of his clocks is $40,what is his break-even point quantity?

• A)10 clocks
• B)100 clocks
• C)1,000 clocks
• D)10,000 clocks

---

Definitions:

Certified Public Accountant

A professional designation given to accountants who pass a standardized CPA exam and meet government-defined education and experience requirements.

Audit

A systematic examination or inspection of financial records, documents, or an entity's performance to ascertain accuracy and compliance.

Contract Law

A branch of legal studies that deals with agreements between parties, their rights, and obligations.

Five-Year Renewal

Typically refers to the option or requirement to renew a contract, license, or agreement for an additional five-year period.