Q:

Marcy’s company produces grandfather clocks. Each clock costs them $164 to make, and they can sell a clock for $625. If their annual overhead costs, not counting the cost to produce the clocks, comes to $96,000, how many clocks must Marcy’s company sell each year to break even? Round to the nearest whole clock, if necessary.a.122b.154c.208d.293

Accepted Solution

A:
Answer:c.208Step-by-step explanation:In order to solve this you just have to calculate how much money can they make by selling one clock, so as you can see they sell the clock at $625, and the cost of producing that clock is $164, the profut for each clock is the selling price minus the cost of producing it:625-164= 461So now you just have to divide the annual overhead by the profit to see how many clock you need to sell to break even:96,000/461= 208.24So Marcy´s company need to sell 208 clocks in order to break even with profits and annual overheads.