Assume Hull Company Has the Following Information Available If Fixed Costs Increase by $200,000,what Is the Break-Even Point

question 133

Multiple Choice

Assume Hull Company has the following information available:
$\begin{array} { l } \text {Selling price per unit }&\$100\\ \text {Variable cost per unit }&\$45\\ \text { Fixed costs per year}&\$400,000\\ \text {Expected sales per year (units) }&20,000\\\end{array}$

If fixed costs increase by $200,000,what is the break-even point in units?

• A) 6,667
• B) 10,000
• C) 12,000
• D) 13,000

---

Definitions:

Tolerance Range

The boundaries a manager sets in determining the acceptable quality of a product.

Dispatching

The process of sending off goods or services to their intended destinations or assigning tasks to individuals.

Taxi Company

A business entity that provides transportation services to passengers via vehicles, such as cars or vans, often on a metered fare basis.

Total Quality Management

A management approach focused on continuous improvement of processes, products, and services to enhance customer satisfaction.