Answer: The Break Even Point in units is 12,000 units.
We follow these steps in order to arrive at the answer:
First we find Total variable costs of Moyas Corporation
[tex]Net Operating Income = Sales - Variable Costs - Fixed Costs[/tex]
[tex]24000 = 300000 - Variable Costs - 96000[/tex]
[tex]\mathbf{Variable Costs = 300000 - 96000 - 24000 = 180000}[/tex]
Next we find the number of units sold:
[tex]No.of units sold = \frac{Total Sales}{Selling price per unit}[/tex]
[tex]\mathbf{No.of units sold = \frac{300000}{20} = 15,000}[/tex]
Then we find Variable Cost per unit
[tex]Variable cost per unit = \frac{Total Variable Cost}{Number of units sold}[/tex]
[tex]\mathbf{Variable cost per unit = \frac{180000}{15000} = 12}[/tex]
We calculate Contribution Margin per unit next
[tex]Contribution Margin per unit = Selling price per unit - Variable costs per unit[/tex]
[tex]\mathbf{Contribution Margin per unit = 20-12 = 8}[/tex]
Finally we calculate Break Even Point (BEP) in units as:
[tex]BEP = \frac{Fixed Costs}{Contribution Margin per unit}[/tex]
[tex]\textbf{BEP_{units} = \frac{96,000}{8} = 12,000 units}[/tex]
