Homework Answers
| Sales revenue required to break-even=Fixed costs/Contribution margin ratio | |
| Contribution margin ratio=Contribution margin/Sales | |
| Contribution margin=Sales-Variable costs=(500000*110%)-(200000*110%)=550000-220000=$ 330000 | |
| Contribution margin ratio=330000/550000=0.6 | |
| Sales revenue required to break-even=180000/0.6=$ 300000 | |
| Answer is | |
| B. $300000 | |
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