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If you have fixed costs of $20,000 and it costs you $10 per unit to...

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Question

Accounting

If you have fixed costs of $20,000 and it costs you $10 per unit to produce each unit. At what dollar amount do you break even if you can sell each unit for $15?

Group of answer choices

$60,000

$ 4,000

$20,150

None of the choices are correct.

$20,000

Which one of the following is not a basic CVP assumption?

Group of answer choices

Total variable costs are constant.

JC's Auto Parts sells oil filters (20%), air filters (10%), and 1 pint cans of oil (70%). Oil filters cost $3 and sell for $7; air filters cost $8 and sell for $15; and pints of oil cost $3 and sell for $5. How many units must be sold to achieve a pretax target income of $40,000 assuming fixed costs are $14,000? (Hint: Remember to compute and use the weighted average contribution margin.)

Group of answer choices

1,920 oil filters; 13,440 air filters; 3,840 cans of oil

2,000 oil filters; 1,000 air filters; 7,000 cans of oil

None of the choices are correct.

1,100 oil filters; 550 air filters; 3,850 cans of oil

3,840 oil filters; 1,920 air filters; 13,440 cans of oil

19,200 oil filters; 19,200 air filters; 19,200 cans of oil

Total fixed costs are constant.

Variable costs per unit are constant.

Selling price per unit is constant.

The above are all CVP assumptions.

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