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Eka manufacturing company produces part #2206 for the aerospace industry. each unit of part #2206 is sold for $15. the unit production cost of part #2206 is $3. the fixed monthly cost of operating the production facility is $3000. how many units of part #2206 have to be sold in a month to break even?

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eooyibo123

Answer:

15.384 units

Explanation:

Break even point is the point at which income from the business is equal to cost incurred. When income is higher than this point, then business is making profit. But when income is less it is a loss.

Using the break even formula

Break even= Fixed cost/(Sales price- cost per unit)

Break even = 3000/(15-3)

Break even = 3000/13= $230.769

To get break even in units sold divide by price of one unit = 230.769/15= 15.384 units

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