Loretta & Niece's Fixed Costs Are $425,000, Including $25,000 of Depreciation

question 31

Multiple Choice

Loretta & Niece's fixed costs are $425,000, including $25,000 of depreciation expense. The price of each unit sold is $120, and the variable cost per unit is $60. How many units must the firm sell to reach the cash break-even point?

• A)Less than 7,333 units
• B)7,333 units
• C)More than 7,333 units
• D)Not enough information has been provided to determine the cash break-even point.

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Definitions:

Monte Carlo

A computational algorithm that relies on repeated random sampling to obtain numerical results, often used in physical and mathematical problems.

Chance Behavior

Unpredictable actions or events that occur without a definitive pattern, often analyzed in probability and statistics.

Computerized Model

A digital simulation or representation of a real-world process, system, or concept designed to study its behavior and make predictions.

Mathematical Modeling

The process of creating a mathematical representation of a real-world situation or system to analyze and predict its behavior.