Breakeven Question

Question

Sally’s Skate Company offers roller skating lessons. Her facility is her only fixed cost, at $800/month. Her instructor rate (a variable cost) is $60 per hour. She has no other costs. If each 1-hour lesson costs a skater $20, how many lessons does she need to break even for the month?

Answer 1

To breakeven, Cost = Revenue

Let x = the number of one hour lessons

C = 800+60x

R = 20x

Setting them equal

800+60x = 20x

800 = -40x

This will give a negative value for x which is not a reasonable solution. It seems like the variable cost may be too high. Should this really be $6 instead of $60? Something isn't right with this problem.