Compute the Break-Even Point [LO6]

Maxson Products distributes a single product, a woven basket whose selling price is $8 and whose variable cost is $6 per unit. The company’s monthly fixed expense is $5,500.

Required:

1. Solve for the company’s break-even point in unit sales using the equation method.

2. Solve for the company’s break-even point in sales dollars using the equation method and the CM r atio.

3. Solve for the company’s break-even point in unit sales using the formula method.

4. Solve for the company’s break-even point in sales dollars using formula method and the CM ratio.