Shock Electronics sells portable heaters for $25 per unit, and the
variable cost to produce them is $17. Mr. Amps estimates that the
fixed costs are $96,000.
1. Compute the break-even point in units.

2. Fill in the table below (in dollars) to illustrate that the
break-even point has been achieved.

Sales
 ??
 
?Fixed costs
 ??
 
?Total variable costs
 ??
 
Net profit (loss)
 ??

Hi carlad22!!


1. Compute the break-even point in units.

Break-even = Fixed Costs / Contribution margin per unit 

where:
Contribution margin per unit = (Revenues - Variable Costs) / Units sold =
                             = Price per unit - Variable cost per unit

Then:
Break-even = $96,000 / ($25 - $17) = 12,000 units .


2. Fill in the table below (in dollars) to illustrate that the
break-even point has been achieved.

Sales = 12,000 * $25 = $300,000
 
Fixed costs = $96,000
 
Total variable costs =  12,000 * $17 = $204,000
 
Net profit = Sales - Fixed Costs - Total Variable Costs =
           = $300,000 - $96,000 - $204,000 =
           = $0.00


I hope that this helps you. Feel free to request for a clarification
if you need it.

Regards.
livioflores-ga

Thank you very much. The response time was excellent. I was checking
my answer and I came up with the same thing. Thanks