Assuming Fixed costs are $100,000 and the per-unit contribution to fixed costs is $20. To break even, the company must sell is:5,000 units.
Using this formula
Break even=Fixed cost/ Per-unit contribution to fixed costs
Where:
Fixed cost=$100,000
Per-unit contribution to fixed costs=$20
Let plug in the formula
Break even=$100,000/$20
Break even=5000 units
Therefore to break even, the company must sell is:5,000 units.
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