5. An item which can be sold for P60 per unit is produced with the following cost: material cost, P14 per unit; labor cost of P12 per unit; fixed cost P12,000; variable cost of P8 per unit. What is the break-even sales in volume if 2 out of every 12 units produced is defective and is rejected with only full recovery on materials?

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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4. An air-conditioning part has a unit selling price of P50, variable cost of P25 per unit
and total fixed cost of P250,000 per year. What is the break-even point in units per
year?
5. An item which can be sold for P60 per unit is produced with the following cost:
material cost, P14 per unit; labor cost of P12 per unit; fixed cost P12,000; variable cost
of P8 per unit. What is the break-even sales in volume if 2 out of every 12 units
produced is defective and is rejected with only full recovery on materials?
Transcribed Image Text:4. An air-conditioning part has a unit selling price of P50, variable cost of P25 per unit and total fixed cost of P250,000 per year. What is the break-even point in units per year? 5. An item which can be sold for P60 per unit is produced with the following cost: material cost, P14 per unit; labor cost of P12 per unit; fixed cost P12,000; variable cost of P8 per unit. What is the break-even sales in volume if 2 out of every 12 units produced is defective and is rejected with only full recovery on materials?
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