R&R Tax Service offers tax and consulting services to individuals and small businesses. Data for fees andcosts of three types of tax returns follow. R&R provides services in the ratio of 5:3:2 (easy, moderate,business). Fixed costs total $18,000 for the tax season. Use this information to determine the (1) sellingprice per composite unit, (2) variable costs per composite unit, (3) break-even point in composite units,and (4) number of units of each product that will be sold at the break-even point.Type of Return Fee Charged Variable Cost per ReturnEasy (Form 1040EZ) . . . . . . . . . . . . . . $ 50 $ 30Moderate (Form 1040) . . . . . . . . . . . . 125 75Business . . . . . . . . . . . . . . . . . . . . . . . . 275 100
R&R Tax Service offers tax and consulting services to individuals and small businesses. Data for fees and
costs of three types of tax returns follow. R&R provides services in the ratio of 5:3:2 (easy, moderate,
business). Fixed costs total $18,000 for the tax season. Use this information to determine the (1) selling
price per composite unit, (2) variable costs per composite unit, (3) break-even point in composite units,
and (4) number of units of each product that will be sold at the break-even point.
Type of Return Fee Charged Variable Cost per Return
Easy (Form 1040EZ) . . . . . . . . . . . . . . $ 50 $ 30
Moderate (Form 1040) . . . . . . . . . . . . 125 75
Business . . . . . . . . . . . . . . . . . . . . . . . . 275 100
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