Argyle sells4 Regular Heavy 2000 1600 2800 2000 Price per un

Argyle sells4 Regular Heavy $20.00 $16.00 $28.00 $20.00 Price per unit Argyle\'s fixed costs are $2,880 per month How much is the breakeven point in total number of units? O A. 600 O B. 590 ??. 578 O D. 620

Solution

Calculation of break even point: Particulars Regular Heavy Selling price 20 28 Less: Variable cost 16 20 Contribution (Selling price- variable cost) 4 8 Contribuiton margin= (4*4/5)+(8*1/5)                                           =(16+8)/5= 24/5= 4.8 Contribuiton margin= $4.80 Break even point= Fixed cost/ contribution margin                                    = 2880/4.80=600 So correct answer is A) 600