Using the information below for 3 and 4

AutoCables, Inc. is currently manufacturing an adapter that has a fixed cost of $120,000, direct labor cost $10 per unit, and material cost $25 per unit. The selling price for the finished product is $50.

Using the information to answer the following 4 questions:

1. Which of the following is the number of units that has to be produced and sold to break-even? 8,000 units

2. What is their revenue at the break-even point? 400,000

3. If the direct labor increases by $1, the break-even point will

a) Be higher

b) Be lower

c) No change

d) Depends

4. If the fixed cost increased by $1000, the break-even point will

This is an independent scenario, which is not based on the above question 3.

a) Depends

b) No Change

c) Be higher

d) Be Lower