Scenario C

Jerry is considering buying a company if it will break even or earn net income on revenues of $80,000 per month. The company that Jerry is considering sells each unit it produces for $5. Use the following cost data to compute the variable cost per unit and the fixed cost for the period. Calculate the break-even point in sales dollars. Should Jerry purchase this company?

Volume (units)/ Total Cost

8,000$ 70,000

68,000 190,000

Show the analysis in a table format.

Write one-paragraph interpretation of the information presented in the table.