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You own a donut shop. Your overhead is $2800/month. You sell several items, but you want...


You own a donut shop. Your overhead is $2800/month. You sell several items, but you want to know the break-even point of the donuts since it's mainly what you sell. You sell them for $3 and your variable cost (the box) is $.50. What is your BEP. Also, what would your total sales on the donuts be.

Solutions

Expert Solution

Ref Particulars Per unit
Units
a Sales revenue                   3.00
Minus:
b Variable cost                   0.50
c= a-b Contribution                   2.50
Break even point
a Contribution per unit                   2.50
b Fixed costs                 2,800
c=b/a BEP units           1,120.00
d Selling price                   3.00
e= c*d BEP sales $       3,360.00

jeff jeffy answered 1 year ago
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