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Case Study: Paul’s Breakeven Costs

Paul the sportswear entrepreneur is having trouble determining the unit volume needed to reach breakeven - both as a breakeven without a desire for profit and the other with a desire for profit.

This is Paul’s situation:

  • Total Fixed costs for his business for 3 months are $9,110
  • Variable cost per unit is $30
  • Sales price per unit is $60
  • Desired profit is $10,000.

Activity Using the calculator from CalcXML, calculate Paul’s anticipated sales required to reach breakeven without the desired profit.

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This article is from the free online course:

Online Business: Pricing for Success

RMIT University