Question

The break-even amount for AllDay Jam if the fixed amount to R25000 and the gross profit percentage is 55%. Calculate

Answer 1

To calculate the break-even amount in sales revenue for AllDay Jam, we can use the following formula:

\[
\text{Break-even sales} = \frac{\text{Fixed Costs}}{\text{Gross Profit Percentage}}
\]

Given:
- Fixed Costs = R25,000
- Gross Profit Percentage = 55% = 0.55

Now we can substitute these values into the formula:

\[
\text{Break-even sales} = \frac{R25,000}{0.55}
\]

Calculating that gives:

\[
\text{Break-even sales} = R45,454.55
\]

Therefore, the break-even amount for AllDay Jam is approximately **R45,454.55**.