Question

Blanchard Company manufactures a single product that sells for $240 per unit and whose total variable costs are $192 per unit. The company's annual fixed costs are $734,400. (1) Prepare a contribution margin Income statement for Blanchard Company showing sales, variable costs, and fixed costs at the break- even point. (2) Assume the company's fixed costs Increase by $138,000. What amount of sales (in dollars) is needed to break even? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare a contribution margin income statement for Blanchard Company showing sales, variable costs, and fixed costs at the break-even point. BLANCHARD COMPANY Contribution Margin Income Statement (at Break-Even) Amount Percentage of sales Sales 0% Required 1 Required 2 >

Answer 1

Break even units = Fixed cost/Contribution margin per unit

= 734,400/(240-192) = 15,300 units

	Amount	percent
Sales (15,300*240)	3,672,000	100%
Variable cost (15,300*192)	2,937,600	80%
Contribution margin	734,400	20%
Fixed cost	734,400
Net operating income	0

.

Fixed cost	/	Contribution margin ratio	=	Breakeven dollars
872,400		20%		4,362,000

.

Comment if you face any issues