Grey, Inc Sells a Single Product for $20

question 44

Multiple Choice

Grey, Inc. sells a single product for $20. Variable costs are $8 per unit and fixed costs total $120,000 at a volume level of 5,000 units. Assuming that fixed costs do not change, Green's break-even sales would be:

• A) $160,000.
• B) $200,000.
• C) $300,000.
• D) $480,000.
• E) None of the other answers is correct.

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Definitions:

Stock Dividend

A stock dividend is a payment made in the form of additional shares of the company's stock rather than cash.

Shares Outstanding

Shares outstanding refer to the total number of shares of a corporation's stock that are owned by shareholders at any given time, including those held by institutional investors and restricted shares held by insiders.

Reverse Stock Split

A corporate action where a company reduces its total number of shares outstanding, thereby increasing the value of each remaining share.

Market Price

The present cost at which a service or asset is available for purchase or sale in the financial marketplace.