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21 September, 06:46

a store has quarterly fixed costs of $50,000 and the unit cost of their product is $10. How many units must they sell per quarter at $20 per unit to break even?

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  1. 21 September, 07:32
    0
    5,000

    Explanation:

    Data provided in the question:

    Quarterly fixed costs of the store = $50,000

    Unit cost of the product = $10

    Selling cost of per unit = $20

    Now,

    Contribution margin = Selling cost of per unit - Unit cost of the product

    = $20 - $10

    = $10

    also, we know that

    Break even units = [Fixed cost] : [Contribution margin]

    = $50,000 : $10

    = 5,000
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