# ECR June 2009 Question

emma2009
New MemberPosts:

**7**Registered
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

## Comments

2,034Registered, ModeratorDid you make an attempt of your own at the question?

There are several correct approches to finding

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2,034Registered, ModeratorIf so, you could get the right answer.

[email protected]

www.sandyhood.com

7RegisteredNo i got £80p-30p = 50p 312,500/0.50p=£625,000

2,034Registered, ModeratorFixed 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 right

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