Question

Question 2 In the month of March, Bramble Salon services 550 clients at an average price of $130. During the month, fixed costs were $23,400 and variable costs were 70% of sales. Collapse question part (a) This grade has been saved to Gradebook. Your answer has been saved and sent for grading. See Gradebook for score details. Determine the contribution margin in dollars, per unit, and as a ratio. Contribution margin $ Contribution margin per unit $ Contribution margin ratio % LINK TO TEXT LINK TO TEXT Attempts: 1 of 1 used Collapse question part (b) This grade has been saved to Gradebook. Your answer has been saved and sent for grading. See Gradebook for score details. Using the contribution margin technique, compute the break-even point in dollars and in units. Break-even sales $ Break-even sales units

Answer 1

A)

Contribution margin = Sales - Variable costs (550*130)-70%	21,450
Contribution margin per unit 130 - 70%	39
Contribution margin ratio 100% - Variable cost ratio = 100%-70%	30%

B)

Breakeven sales = Fixed cost/Contribution margin ratio = 23,400/30%	78,000
Breakeven sales = Fixed cost/Contribution margin per unit = 23,400/39	600