Question

i need help with #8

8. Henning Co. estimates that variable costs will be 70% of sales and fixed costs will total $2,160,000. The selling price of the product is $10, and 750,000 units will be sold. Instructions Compute the break-even point in units and dollars. Compute the margin of safety in dollars and as a ratio. (a) (b) 9. DeMont Tax Services provides primarily two lines of service: accounting and tax. Accounting- related services represent 60 % of its revenue and provide a contribution margin ratio of 30 %. Tax services represent 40% of its revenue and provide a 40% contribution margin ratio. The company's fixed costs are $4,590,000. Instructions Calculate the revenue from each type of service that the company must achieve to break even. BE6-7 NoFly Corporation sells three different models of a mosquito "zapper." Model A12 sells for $50 and has variable costs of $35. Model B22 sells for $100 and has variable costs of $70. Model C124 sells for $400 and has variable costs of $300. The sales mix of the three models is Al12, 60%; B22, 15%; and C124, 25%. What is the weighted-average unit contribution margin?

Answer 1

@ Break even point in units and dollars BEP in units - fixed cost Contribuhon Maigh pe unit Contribution Margin per unit = Sales price per unit - vakiable cost per unit BEP in units : 2160,000 2160000 = 7:20,000 10-70% BEP in (8) = Sales price per unit & BEP is units = 10x7,20,000 = 72,00,000 6 Margin of safety is units & Dollars. margin of safety in &- Actual expected) - Break even Sales 75,00,000 - 72,00,000 Maigin of Safety (munit) - 3,00,000 Curent sale, level - Break even point xloo current sales level = 7,50,00 - 7,20,000 7,50,000 - 9%