Algebraic Given the price and cost data shown in the accompanying table
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Algebraic Given the price and cost data shown in the accompanying table

P13–2 Breakeven comparisons: Algebraic Given the price and cost data shown in the accompanying table for each of the three firms, F, G, and H, answer the questions that follow.

Firm   F G H

Sale price per unit   $18.00  $21.00  $30.00

Variable operating cost per unit   $6.75  $13.50  $12.00

Fixed operating cost   45,000 30,000 90,000

a. What is the operating breakeven point in units for each firm?

b. How would you rank these firms in terms of their risk?

Hint
Accounts & FinanceThe breakeven point is where the total sales equal the total production cost, meaning no profits or losses are being made as the amount coming in from sales is the same amount used to cover operational costs. To break a breakpoint, you need to either increase the prices of your services or reduce the cost of expenses....
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