Intelligent Semiconductor, a diversified technology company, is evaluating the sales of its cadmium silicon transistor coils, and has identified the following information:
Fixed production costs for these transistors: $750,000
Average sales price per unit: $405.00
Variable cost per unit: $313.60 -
Which of the following best describes the breakeven quantity for this product?
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A. B. C. D. E.B
To calculate the breakeven quantity for a product, use the following equation: {Fixed operating costs/[avg. sales price per unit - variable cost per unit]}.
Incorporating the given information into this equation yields the following: {$750,000/[$405 - $313.60]}=8,206 units.