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A company's break even point is 6 000 units per annum...

This question belongs to Commerce Costing
Costing
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A company's break even point is 6,000 units per annum. The selling price is Rs 90 per unit and the variable cost is Rs 40 per unit. What are the company's annual fixed costs?

Answer & Solution
Correct Answer: Option C
Fixed Costs = Break-Even Point (Units) × (Revenue per Unit – Variable Cost per Unit)
= 6000 × ( 90 - 40) = Rs. 300000.
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