Question

At the beginning of January, Kesia Records paid $148,950 to acquire the exclusive rights to a new album. It costs them $1.13 to print a copy of this album, which they can sell for $9.75. The following chart shows the sales of that record, along with the overhead expenses of running a record studio, not counting production costs.

Month
Albums Sold
Expenses
Jan.
5,486
$27,714
Feb.
8,191
$21,689
Mar.
4,796
$25,195
Apr.
7,490
$28,766
May
6,272
$24,604
Jun.
5,131
$29,040

In whch month did Kesia Records first break even?
a.
January
b.
March
c.
April
d.
May


Please select the best answer from the choices provided

A
B
C
D

Answer 1

D

Work (summary):
- Monthly net = (albums × $9.75) − (albums × $1.13) − overhead.
- Cumulative after Jan–Apr remains negative (≈ −$28,513).
- May net ≈ $29,460.64 → cumulative ≈ +$947.70, so break-even occurs in May.