Reference no: EM133043795

Question - A firm is projecting total sales of $80,000, variable costs of $50,000 and fixed costs of $10,000. The firm is making those projections by assuming unit sales of 5,000 units. If interest expense is projected to be $4,000 and the tax rate is 25%, what is the operating break even units and dollars?

a. Operating break even units = 666.67; Operating break even dollars = $10,666.67

b. Operating break even units = 2,222.22; Operating break even dollars = $35,555.56

c. Operating break even units = 2,333.33; Operating break even dollars = $37,333.33

d. Operating break even units = 1,666.67; Operating break even dollars = $26,666.67