Answer to Question #201705 in Management for Anathi Tobigunya

Question

Whilst drawing up the budget for the coming year, Kabelo decides to determine the break-even point for new cryotherapy equipment. The fixed cost per year to maintain the cryotherapy equipment amounts to R165 000. Kabelo estimates that the variable cost per session will be around R30. If Kabelo and Hendrik decide to charge gym members R280 per session, how many sessions will they need to sell if they want to break-even?

1 589

2 532

3 660

4 The break-even point cannot be calculated given the information above.

Answer 1

532