What is the breakeven point in standard test hours

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An engineering testing laboratory measures its output in a standard service hour unit, which is a function of the level of testing to be performed. The variable cost (CV) is $112 per standard test service hour. The charge-out rate (i.e., selling price, p) is $135.9 per hour.

The maximum output of the testing lab is 260,000 hours per year, and its fixed cost (CF) is $3,845,000 per year.

What is the breakeven point in standard test hours?

Reference no: EM13796231

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