Scott Incorporated has been in business for several months. Because of increased

Question

Scott Incorporated has been in business for several months. Because of increased competition in the region for part? adapters, the managers at Scott Incorporated is considering cutting sales price from $ 24 per adapter to $ 22 per adapter. New sales price per poster $ 22 Variable price per adapter $ 19 New contribution margin per adapter $ 3 If the variable expenses remain at $ 19 per adapter and the fixed expenses remain at $ 7 comma 000?, how many adapters will the managers need to sell to break? even? Compute the breakeven sales in units. A. 2 comma 334 units B. 2 comma 388 units C. 2 comma 308 units D. 2 comma 314 unit

Explanation / Answer

Break even point = Fixed cost/Contribution margin per unit

= 7000/3

Break even point = 2334 Units

SO answer is a) 2334 Units

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