A Company Makes a Certain Product for $4 Each and Sells

question 3

Multiple Choice

A company makes a certain product for $4 each and sells it for $8.If the company has overhead expenses of $10,000 per year,how many of its products must be made and sold to break even?

• A)20,000
• B)40,000
• C)2,500
• D)10,000

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Definitions:

Loan Payoff

A payment or series of payments made to clear a loan's outstanding balance.

Original Purchase

The initial acquisition of an asset or item, often referring to the first time it was bought or the condition in which it was first obtained.

Stockholders' Equity

Stockholders' equity represents the residual interest in the assets of a corporation, after deducting its liabilities. It is also known as shareholders' equity.

Liabilities

Liabilities represent obligations or debts that a company owes to external parties, which must be settled through the transfer of assets or services.