Assume a firm has positive net earnings. The operating cash flow of this firm: Group of answer choices ignores both depreciation and taxes. is unaffected by th

The break-even point is $28,000

Explanation:

Since, the sale value is not given in the question, so we have to compute the profit volume ratio which is equals to

= (Sales per unit  - Variable cost per unit ) ÷ Sales × 100

Where,

Sale per unit is $28

Variable cost per unit = 65% of sales per unit = 65 ÷100 × 28 = $18.2

So, profit volume ratio equals to

=  ($28 - $18.2) ÷ $28 × 100

= 35%

Now, we can easily calculate the break even point. The formula is shown below:

= Fixed expense ÷ Profit volume ratio

= $9,800 ÷ 35%

= $28,000

Hence, the break-even point is $28,000