SOLUTION: A video game manufacturer is planning to market a handheld version of its game machine. the fixed costs are $550,000 and the variable costs are $120 per machine. the wholesale pric

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Question 1041266: A video game manufacturer is planning to market a handheld version of its game machine. the fixed costs are $550,000 and the variable costs are $120 per machine. the wholesale price of the machine will be $140.
1. how many game machine must be sold for the company to make a profit?
2. how many game machines must be sold for the company to break even?
3. discuss the relationship between the results in part 1 and 2.
Answer by jorel555(1290) About Me  (Show Source):
You can put this solution on YOUR website!
140-120=20 profit per machine
550000/20=27500 machines
1.In order to make a profit, they must sell over 27500 machines.
2.To break even, they must sell at least 27500 machines
3.The break even point is that point at which total profits are equal to total costs. Anything above that is when the company actually starts to make money. ☺☺☺☺