Ruben corporation-breakeven point

Reference no: EM1364369

Corresponds to CLO 2(c) Ruben Corporation manufactures and sells T-shirts imprinted with college names and slogans. Last year, the shirts sold for $7.50 each, and the variable cost to manufacture them was $2.25 per unit. The company needed to sell 20,000 shirts to break even. The net income last year was $5,040. Ruben's expectations for the coming year include the following:

- The sales price of the T-shirts will be $9

- Variable costs to manufacture will increase by one-third

- Fixed costs will increase by 10%

- The income tax rate of 40% will be unchanged

The number of T-shirts Ruben Corporation must sell to break even in the coming year is:

a 17,500

b 19,250

c 20,000

d 22,000

Reference no: EM1364369

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