Question 943911: A shoe maker has fix costs of $15,879 for rent, supplies, salaries, and alike and a cost of $28 for each pair of shoes he sells. Lets say that, on average, each pair of shoes sells for $115. How many pair does he need to sell to break even? If each of his employees can make a pair of shoes in 4 days, how many employees does he need to purchase the required number of pairs of shoes to break even in a year? (round to whole numbers and assume there are 250 days in a year)
Answer by macston(5194)   (Show Source):
You can put this solution on YOUR website! for each pair: selling price-cost=profit $115-$28=$87/pair
To cover fixed costs of $15879 at $87/pair requires $15879/$87 pairs=183 pairs ANSWER 1 The shoe maker must make 183 pairs to break even
At 4 employee days per pair, he needs (4 employee days/pair)(183 pairs)=732 employee days. At 250 days /year/employee, 732employee days/250 employee days/employee=2.928=3 ANSWER The shoe maker would have to hire 3 employees to make 183 pairs of shoes per year to break even.
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