Dirth Company Sells Only One Product at a Regular Price

question 92

Multiple Choice

Dirth Company sells only one product at a regular price of $7.50 per unit. Variable expenses are 60% of sales and fixed expenses are $30,000. Management has decided to decrease the selling price to $6.00 in hopes of increasing its volume of sales. What is the sales dollars level required to break even at the old price of $7.50?

• A) $75,000
• B) $12,000
• C) $18,000
• D) $50,000

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Definitions:

Worker Productivity

A measure of the efficiency of a worker or a group of workers, often quantified as the amount of work produced over a defined period of time.

Consumer Buying Habits

The patterns and behaviors exhibited by individuals when purchasing goods and services, often influenced by psychological, social, and economic factors.

Pearl Harbor

A U.S. naval base in Hawaii that was the site of a devastating surprise attack by Japanese forces on December 7, 1941, leading the United States to enter World War II.

Adolf Hitler

The dictator of Nazi Germany from 1933 to 1945, known for initiating World War II and the Holocaust, which resulted in the death of six million Jews and millions of others.