Canine Company produces and sells dog treats for discriminating pet owners. The unit selling price is $10, unit variable costs are $7, and total fixed costs are $3,300. What are breakeven sales? (Points :1)
$11,000
$4,714
$3,300
$7,700
10xtreats-7x treats-3,300=0
Treats=1,100
$10x1,100=11,000
To find the breakeven sales, we need to determine the quantity of products that need to be sold in order for the company to cover its total fixed costs.
The formula to calculate breakeven sales is:
Breakeven Sales = Fixed Costs / (Selling Price per Unit - Variable Costs per Unit)
Given:
Unit selling price = $10
Unit variable costs = $7
Total fixed costs = $3,300
Using the formula, we can substitute in the given values:
Breakeven Sales = $3,300 / ($10 - $7)
Breakeven Sales = $3,300 / $3
Breakeven Sales = $1,100
Thus, the breakeven sales amount is $1,100.
Therefore, the correct answer is $1,100.