Please help me in how to go about figuring out the break-even point in the follo

Question

Please help me in how to go about figuring out the break-even point in the following case:

Thank you!

How would you respond to the information that Lesley Chomski discovered regarding her own bonus? In addition to discussing the ethical dilemmas of this case, please discuss how breakeven for the product R56 was calculated and if this was correct or not.
Case: Lesley Chomski is the supervisor of the New Product Division of MCO Corporation. Her annual bonus is based on the success of new products and is computed on the number of sales that exceed each new product%u2019s projected break-even point. In reviewing the computations supporting her most recent bonus, Chomski found that although an order for 7,500 units of a new product called R56 had been refused by a customer and returned to the company, the order had been included in the calculations. She later discovered that the company%u2019s accountant had labeled the return an overhead expense and had charged the entire cost of the returned order to the plant-wide overhead account. The result was that product R56 appeared to exceed breakeven by more than 5,000 units and Chomski%u2019s bonus from this product amounted to over $800. What actions should Chomski take?

Explanation / Answer

THE RETURN SHOULD NOT BE TREATE AS AN OVERHEAD EXPENSE, THIS CALCULATION IS WRONG.
IT SHOULD BE DEDUCTED FROM SALES, AND TREATED AS SALES RETURNS AND THE BONUS SHOULD BE ADJUSTED ACCORDINGLY.

BREAK EVEN SALES SHOULD BE CALCULATED AFTER DEDUCTING THE SALES RETURNS

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