A bicycle store costs ​$1800 per month to operate. The store pays an average of ​$60 per bike. The average selling price of each bicycle is ​$90. What is the monthly bicycle sell to break even?

Answer 1

Cost = C = 1800+60B

Revenue = 90B

Profit = P = R-C = 90B-60B-1800 = 30B -1800

Breakeven point is when Profit = 0

0 = 30B -1800

30B = 1800

B =1800/30 = 180/3 = 60 Bikes sold

60 times $90 = $5400 in Revenue

Cost = 1800+60($60) = 1800+3600= $5400

with less than 60 bikes sold, the store suffers a loss

with more than 60 bikes sold the store earns a profit

at exactly 60 bikes sold, the store breaks even