document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=176761>Question 176761</A>: <I><SPAN STYLE=\"word-break: break-all;\"> Can someone please help me with this problem:\r<BR>\n" );
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document.write( "A company sells a product  at $60 per unit that has unit variable costs of $40. The company's break-even sales volume is $120,000. How much profit will the company make if it sells 4,000 units?<BR>\n" );
document.write( "a. $240,000<BR>\n" );
document.write( "b. $40,000<BR>\n" );
document.write( "c. $80,000 </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #132305 by </B><A HREF=/tutors/aboutme.mpl?userid=gonzo><B>gonzo(654)</B></A><img src=\"/images/stars/stars-11.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=gonzo><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/images/nopicture.jpg><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=132305\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> company breaks even at sales volume of $120,000<BR>\n" );
document.write( "to make $120,000, it had to sell $120,000 / $60.00 revenue per unit sold.<BR>\n" );
document.write( "number of units sold = $120,000 / $60.00 = 2000.<BR>\n" );
document.write( "variable cost for 2000 units sold is 2000 * $40.00 = $80,000.<BR>\n" );
document.write( "profit = revenue - cost<BR>\n" );
document.write( "cost = variable cost plus fixed cost.<BR>\n" );
document.write( "let p = profit<BR>\n" );
document.write( "let r = revnue<BR>\n" );
document.write( "let f = fixed cost<BR>\n" );
document.write( "let v = variable cost<BR>\n" );
document.write( "formula is:<BR>\n" );
document.write( "p = r - (f + v)<BR>\n" );
document.write( "remove parentheses to get:<BR>\n" );
document.write( "p = r - f - v<BR>\n" );
document.write( "since the company breaks even at a volume of $120,000 in revenue, this means that:<BR>\n" );
document.write( "p = 0<BR>\n" );
document.write( "r = $120,000<BR>\n" );
document.write( "f = f<BR>\n" );
document.write( "v = $80,000<BR>\n" );
document.write( "and the formula becomes:<BR>\n" );
document.write( "$0 = $120,000 - f - $80,000<BR>\n" );
document.write( "which becomes:<BR>\n" );
document.write( "$0 = $40,000 - f<BR>\n" );
document.write( "add f to both sides of the equation to get:<BR>\n" );
document.write( "f = $40,000<BR>\n" );
document.write( "since you know the fixed cost, you can now determine the profit on sales of 4000 units.<BR>\n" );
document.write( "formula is:<BR>\n" );
document.write( "p = r - f - v<BR>\n" );
document.write( "f = $40,000<BR>\n" );
document.write( "v = $40.00 * 4000 = $160,000<BR>\n" );
document.write( "r = $60.00 * 4000 = $240,000<BR>\n" );
document.write( "formula becomes:<BR>\n" );
document.write( "p = $240,000 - $40,000 - $160,000<BR>\n" );
document.write( "which becomes:<BR>\n" );
document.write( "p = $240,000 - $200,000<BR>\n" );
document.write( "which becomes:<BR>\n" );
document.write( "p = $40,000<BR>\n" );
document.write( "company will make $40,000 profit if it sells 4000 units.\r<BR>\n" );
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document.write( " </SPAN>\n" );
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