Read the following information carefully and answer the questions that follow.
Jess runs a business which makes and distributes frozen chips to restaurants and hotels
in her local area. She buys potatoes from Johnson's, a local farm. The business spends
£50 000 each year on fixed costs. In 2018, the total variable costs came to £0.85 per kg
of chips and each packet of chips was sold for £1.80 per kg. Using these figures and her
actual sales in 2018 Jess worked out her break-even level of output and her margin of safety.
a) Calculate Jess's break-even level of output for 2018.
Give your answer to 3 significant figures.
Show your working.
