Werth Company produces tie racks. Its estimated fixed costs for the year are $288,000, and the estimated variable costs per unit are $14. Werth expects to produce and sell 60,000 racks at a price of $20 per unit. How many units will be sold at breakeven?

The correct answer is 48,000.

Explanation:

According to the scenario, the given data are as follows:

Estimated fixed costs = $288,000

Estimated variable costs / unit = $14

Estimated sells Price = $20

So, we can calculate the number of units sold at breakeven by using the following formula:

Breakeven point = Estimated fixed costs / Estimated sells Price - Estimated variable costs

So, by putting the value, we get

= $288,000 / $20 - $14

= $288,000 / $6

= 48,000

Hence, the units that will be sold at breakeven is 48,000.

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a manufacturer of printed circuit boards uses exponential smoothing with trend to forecast monthly demand of its product. at the end of december, the company wishes to forecast sales for january. the estimate of trend through november has been 200 additional boards sold per month. average sales have been around 1000 units per month. the demand for december was 1100 units. the company uses α = 0.20 and β = 0.10. make a forecast including trend for the month of january.