Question 1. How to calculate a break-even point based on units: Divide fixed costs by the revenue per unit minus the variable cost per unit. The fixed costs are those that do not change no matter how many units are sold. The revenue is the price for which youre selling the product minus the variable costs, like labor and materials. Break-Even Point (Units) = Fixed Costs (Revenue per Unit Variable Cost per Unit)

2. Assume you own a soft goods company that prints logo sportswear (hats, tees, sweatshirts, etc.) for college teams. Angelo State is competing in the College Football Division II Championship. You decide to purchase sweatshirts and print Angelo State University football sweatshirts and sell before the bowl game. The fixed costs (FC) for the one-month period before the NCAA Football Championship (Division II Championship) are $75,000 and the variable cost (VC) for logo, hooded sweatshirts is $35.00 per sweatshirt. Question: What would be the break-even price to produce 55,000 sweatshirts? For 182,000 sweatshirts? If, in the above example, you produce 80,000 sweatshirts for Angelo State University and set the wholesale price at $4.00 above the break-even price, how much will you pay ASU on an 11.5% royalty fee?

Now the retailer wants to increase the price of the shirt by 30% (to make a 30% profit on each Sweatshirt) what would each sweatshirt cost the consumer?