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Daphne’s Planter Company produces and sells planters. The manager reported $10,500 in fixed expenses, operating income of $0 at the breakeven point, and a contribution margin per unit of $60. What is the company’s breakeven point in units using the shortcut approach?

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jepessoa

Answer:

The answer is: The break even point for Daphne's Planter Company is 175 units.

Explanation:

Daphne's Planter Company's break even point can be calculated using the following formula:

  • Break even point = fixed costs / contribution margin per unit

The break even point for Daphne's Planter Company is:

BEP = $10,500 / $60 per unit = 175 units