Prepare a Cost-Volume-Profit (CVP) Graph [LO2]

Katara Enterprises distributes a single product whose selling price is $36 and whose variable expense is $24 per unit. The company’s monthly fixed expense is $12,000.

Required:

1. Prepare a cost-volume-profit graph for the company up to a sales level of 2,000 units.

2. Estimate the company’s break-even point in unit sales using your cost-volume-profit graph.