Question in description. Thanks a lot!

Question

The produce each product unit, the company spends $1.85 on material and $3.25 on labor. Its total fixed cost is $9000. Each unit sells for $6.15.

What is the smallest number of units that must be sold for the company to realize a profit?

Answer 1

Let x = the number of units produced

Revenue (R) = selling price x number of units

R = 6.15x

Cost (C) = cost per unit x number of units + fixed costs

C = (1.85 + 3.25)x + 9000 = 4.10x + 9000

Profit = Revenue - Cost

P = 6.15x - (4.10x + 9000)

P = 2.05x - 9000

The breakeven point (no profit or loss) occurs when P = 0:

0 = 2.05x - 9000

Solve for x. Round up to the next integer value.