Fill This Form To Receive Instant Help
Fill This Form To Receive Instant Help
Homework answers / question archive / Eastman Publishing Company is considering publishing a paperback textbook on spreadsheet applications for business
Eastman Publishing Company is considering publishing a paperback textbook on spreadsheet applications for business. The fixed cost of manuscript preparation, textbook design, and production setup is estimated to be $160,000. Variable production and material costs are estimated to be $6 per book. Demand over the life of the book is estimated to be 4000 copies. The publisher plans to sell the text to college and university bookstores for $46 each.
a. What is the breakeven point?
Computation of the break even point:-
Break even point = Fixed cost / (Sell price - Variable cost)
= $160,000 / ($46 - $6)
= $160,000 / $40
= 4,000 units
