A software development company has fixed costs of $500,000 and variable costs of $5,000 per software product. The company charges $15,000 per software product. What is the break-even revenue for the company? a. $1,000,000 b. $0 c. $500,000 d. $1,500,000 e. $2,500,000 Clear my choice

A software development company has fixed costs of $500,000 and variable costs of $5,000 per software product. The company charges $15,000 per software product. What is the break-even revenue for the company? a. $1,000,000 b. $0 c. $500,000 d. $1,500,000 e. $2,500,000 Clear my choice

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Pricing

Pricing is used as a term in finance and economics, pricing is the process of fixing a value for a product or a service. Pricing establishes a value for a product or service that the customer has to pay. A business can choose from different strategies while deciding to set prices.

Question

A software development company has fixed costs of $500,000 and variable costs of
$5,000 per software product. The company charges $15,000 per software product.
What is the break-even revenue for the company?
a. $1,000,000
b. $0
c. $500,000
d. $1,500,000
e. $2,500,000
Clear my choice

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