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Lada Lada
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6 years ago
Last year, Terrific Copying had total revenue of $475 000, while operating at 60% of capacity. The total of its variable cost is $150 000. Fixed costs were $180 000. What is Terrific's break-even point expressed in dollars of revenue?
A) $289 855
B) $1 077 844
C) $900 000
D) $263 158
E) $300 000
Textbook 
Contemporary Business Mathematics with Canadian Applications

Contemporary Business Mathematics with Canadian Applications


Edition: 11th
Authors:
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AxyAxy
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6 years ago
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D

Excerpt
To find Terrific Copying's break-even point expressed in dollars of revenue, you can use the following formula:

Break-Even Point (in dollars) = Fixed Costs / (1 - (Variable Costs / Total Revenue))

In this case, Terrific Copying's fixed costs are $180,000, variable costs are $150,000, and total revenue is $475,000. So, you can plug these values into the formula:

Break-Even Point (in dollars) = $180,000 / (1 - ($150,000 / $475,000))

Break-Even Point (in dollars) = $180,000 / (1 - 0.3158)

Break-Even Point (in dollars) = $180,000 / 0.6842

Break-Even Point (in dollars) ≈ $263,158 (rounded to the nearest dollar)

So, Terrific Copying's break-even point expressed in dollars of revenue is approximately $263,158, which is option D.

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Anonymous
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#10
A month ago
Help! The answer is missing an explanation...
wrote...
#11
A month ago
Here's a similar question:

Quote
Last year, Terrific Copying had total revenue of $603240, while operating at 52% of capacity. The total of its variable cost is $153575. Fixed costs were $194105. What is Terrific's break-even point expressed in dollars of revenue? Enter as dollars and cents without a dollar sign or comma.
Anonymous
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#12
4 weeks ago
Help! The answer is missing an explanation...
Axy
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#13
4 weeks ago
Quote from: Anonymous (4 weeks ago)
Help! The answer is missing an explanation...

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