ECR June 2009 Question
emma2009
Registered Posts: 7 Regular contributor ⭐ ? ⭐
Hi,
I am struggling to find the answer to task 2.3 a,b+c.
Do you know where you get the 50p from?
Can someone try and explain the answer to me because im confused?
Thank you
Emma
I am struggling to find the answer to task 2.3 a,b+c.
Do you know where you get the 50p from?
Can someone try and explain the answer to me because im confused?
Thank you
Emma
0
Comments

Emma
Did you make an attempt of your own at the question?
There are several correct approches to finding £500,000
 £820,000
 £375,000 and 75%
0 
Did you find (a) the break even value by finding break even unit x price?
If so, you could get the right answer.0 
Hi,
No i got £80p30p = 50p 312,500/0.50p=£625,0000 
Just look at that sum:
Fixed costs of £312,500 divided by the contribution earned every time one unit is sold (£0.50)
If I had £312,500 and I divided it by £0.50 I could say there are 625,000 50 pences in £312,500
In other words I must sell 625,000 units if I am to collect enough 50 pences to pay the fixed costs.
So £312,500/£0.50 = 625,000 units
and this is not the same as £625,000
In this exam a large number of candidates then said:
If I must sell 625,000 units to breakeven then the breakeven sales revenue must be this number of units x the price per unit (£0.80)
625,000 x £0.80 = £500,000
and got it right0
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