A plant has a capacity of producing 80T units per year of a product which it sells for P20.00 per unit      regardless of output.  The annual FC are P280T & a variable cost of P480T at 75% capacity. a) What is the break-even point in units? b) What is the fixed cost per unit and variable cost per unit at the break-even point? c) What is the profit at this level (75%) and at 100% capacity? d) At what volume of output will the company incur a loss?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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)  A plant has a capacity of producing 80T units per year of a product which it sells for P20.00 per unit

     regardless of output.  The annual FC are P280T & a variable cost of P480T at 75% capacity.

  1. a) What is the break-even point in units?
  2. b) What is the fixed cost per unit and variable cost per unit at the break-even point?
  3. c) What is the profit at this level (75%) and at 100% capacity?
  4. d) At what volume of output will the company incur a loss?
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