A Manufacturing Company Is Studying the Feasibility of Producing a New

Multiple Choice

A manufacturing company is studying the feasibility of producing a new product. The selling price is expected to be $80. The new production line would manufacture up to 9,000 units at a variable cost of $15 per unit. Fixed costs would be $150,000. Variable selling and administration expenses would amount to $5. Determine the break-even point as a percent of capacity.

A) 27.78%
B) 28.55%
C) 29.32%
D) 32.45%
E) 41.62%