It costs$1500 each week to make bookbags plus a marginal cost of $10 per calculator. Find the break even point for the bookbags if the bookbags are sold for $40

Question

It costs$1500 each week to make bookbags plus a marginal cost of $10 per calculator. Find the break even point for the bookbags if the bookbags are sold for $40 a piece.

Answer 1

Hello Leah,

 

I am assuming that the 10$ per calculator is applied for each bookbag sold. If that is the case, then this problem can be formed into a fairly simple equation. First we need to connect some dots- the break even point is where the money made is equal to the money spent. Thus,

 

Cost = $ from sales

 

We can now substitute the number values, and add variables (I am assigning x to be the number of book bags sold and the number of calculators). Thus,

 

1500 + 10x (this is the cost, including the cost per calculator) = 40x

 

Now we simplify the equation, which gives us,

 

1500 = 30x

 

Now, divide by 30, and we get a solution of x = 50.

 

So the break even point for this question is 50 book bags. Or in other words, 50 of the bags need to be sold each week to recoup the amount spent on production.

 

-Adam

Answer 2

let x = number of bookbags & calculators

 

40x = total gross profit from bookbags 

 

1500 + 10x = total costs

 

40x - (1500 + 10x) = 0

 

30x - 1500 = 0

 

30x = 1500

 

x = 50