For the current year ending April 30, Hal Company expects fixed costs of $60,000, a unit variable cost of $70, and a unit selling price of $105.
60000/(105-70)
60000/35 = 1714.29 0r 1714 units
To find the breakeven point, we need to determine the number of units that need to be sold to cover all costs. The breakeven point is where total revenue equals total cost.
First, let's calculate the contribution margin per unit:
Contribution margin per unit = Selling price per unit - Variable cost per unit
Contribution margin per unit = $105 - $70
Contribution margin per unit = $35
Next, we can use the contribution margin per unit to find the breakeven point in units:
Breakeven point (in units) = Fixed costs / Contribution margin per unit
Breakeven point (in units) = $60,000 / $35
Now, let's calculate the breakeven point:
Breakeven point (in units) = 1714.29
Since we can't sell fractional units, we round up to the nearest whole number:
Breakeven point (in units) = 1715 units
Therefore, Hal Company needs to sell 1715 units to cover all costs and reach the breakeven point for the current year ending April 30.