Math-FInance please help me

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Healthy food Inc sells 50lb bags of grapes to the military for $10 a bag.
The fixed costs of this operation are $80,000 while the variable costs of the grapes are $10 per lb.

1. what us the break even point
2. what is the degree of combined leverage at both sales levels.

  • Math-FInance please help me -

    2. What two sales levels are you refering to?

    As for part 1, there must be s mistake somewhere. Is it $10 per lb (as you state) or $10 per bag? Or less? You will never make a profit selling 50lb bags for $10, if the variable cost is $10 per lb ($500 per bag).

  • Math-for drwls -

    For question number 2 the teacher states operating leverage and financial leverage but that is it I am totally confused? Thanks for the help

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