If Spruce Pine Mfg. Co. has fixed costs of $300,000 and variable costs of $30 per unit with a selling price of $50, what is the break-even point in units?

To find the break-even point in units, it is necessary to use the break-even formula, which incorporates both fixed costs and variable costs relative to the selling price. The break-even point is calculated by dividing total fixed costs by the contribution margin per unit. The contribution margin is derived from the selling price minus the variable costs per unit.

In this scenario, Spruce Pine Mfg. Co. has fixed costs of $300,000. The variable cost per unit is $30, and the selling price per unit is $50. First, we calculate the contribution margin, which is:

Contribution Margin = Selling Price - Variable Costs

Contribution Margin = $50 - $30 = $20

Next, we can calculate the break-even point in units:

Break-Even Point (Units) = Fixed Costs / Contribution Margin

Break-Even Point (Units) = $300,000 / $20

Break-Even Point (Units) = 15,000 units

Thus, the correct answer is that the break-even point is 15,000 units. This indicates that Spruce Pine Mfg. Co. needs to sell 15,000 units to cover all its fixed and variable costs, after which it begins to generate profit.