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Solution Library
Calculation of Break Even Unit sales of a Company
Question
In 2015, X Company had the following selling price and per-unit variable cost information:
Selling price $153.60
Direct materials 44.60
Direct labor 27.60
Variable overhead 25.90
Variable selling and administrative 26.00
In 2015, fixed overhead costs were $468,000, and fixed selling and administrative costs were $279,000.
In 2016, there are only two expected changes. Direct material costs are expected to increase by 20% per unit, and fixed selling administrative costs are expected to increase by $10,000. What must unit sales be in order for X Company to break even in 2016?
Summary: This question belongs to accounting and discusses about a company’s break even unit sales using selling price and per-unit variable cost information.
Total word count: 20
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