Using break-even analysis LO A company has prepared the following statistics regarding its production and

* ' sales at different capacity levels.

Capacity level 60% 80% 1 00%

Units 60,000 80,000 100,000 Sales $240,000 $320,000 $400,000 Total costs: Variable $120,000 $160,000 $200,000 Fixed 1 50,000 1 50,000 1 50,000 Total costs $270,000 $310,000 $350,000 Net profit (loss) "$ (30,000) $ 10,000 $ 50,000 1. At what point is break-even reached in sales dollars? In units?

2. If the company is operating at 60% capacity, should it accept an offer from a customer to buy 10,000 units at $3 per unit?