The following data are for Julian Mark Company. Selling price per unit $5.00 Var

Question

The following data are for Julian Mark Company.

Selling price per unit                                                                  $5.00

Variable cost per unit                                                               $2.00

Number of units sold                                                    50,000 units

Net income                                                                            $40,000

Calculate the breakeven point in number of units.

  45,455 units

  39,286 units

  35,714 units

  36,667 units

  28,000 units

  45,455 units

  39,286 units

  35,714 units

  36,667 units

  28,000 units

Explanation / Answer

Calculation of break Even Point Selling Price 5 Variable Cost 2 Contribution 3 Total 50000*3 150000 Net Income 40000 Fixed Cost 110000 Break Even Point = Fixed Cost/ Contribution per unit = 110000/3 36667 The correct answer is D) 36667 units

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