Break-Even Point Hilton Enterprises sells a product for $51 per unit. The variab
ID: 2601643 • Letter: B
Question
Break-Even Point
Hilton Enterprises sells a product for $51 per unit. The variable cost is $34 per unit, while fixed costs are $21,675.
Determine (a) the break-even point in sales units and (b) the break-even point if the selling price were increased to $59 per unit.
units
Target Profit
Trailblazer Company sells a product for $215 per unit. The variable cost is $115 per unit, and fixed costs are $600,000.
Determine (a) the break-even point in sales units and (b) the break-even point in sales units if the company desires a target profit of $174,000.
a. Break-even point in sales units units b. Break-even point if the selling price were increased to $59 per unitunits
Explanation / Answer
a Sales Price 51 Variable Cost 34 Contribution 17 Fixed Cost 21675 BEP (Units)21675/17 1275 Units b Sales Price 59 Variable Cost 34 Contribution 25 Fixed Cost 21675 BEP (Units)21675/25 867 Units a Sales Price 215 Variable Cost 115 Contribution 100 Fixed Cost 600000 BEP (Units)600000/100 6000 Units b Sales Price 215 Variable Cost 115 Contribution 100 Fixed Cost 600000 Target Profit 174000 Total 774000 BEP (Units)774000/100 7740 Units
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