(TCOs 6 and 7) A product is currently made in a job shop, where fixed costs are $11,000 per year and variable cost is $60 per unit. The firm sells the product for $100 per unit. What is the break-even point for this operation? What is the profit (or loss) on a demand of 250 units per year?

Fixed costs= 11000$ per year

Variable cost = 60$ per unit

Selling price = 100$ per unit

Breakeven point = Fixed costs/(Selling price – variable price)

= 11000/(100-60)

= 275 units

Demand = 250 units

Profit/loss = units(Selling price-variable cost) – Fixed cost

= 250*40 – 11000

= -1000$ loss

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