If the selling price per unit is $80, the variable expense per unit is $20, and...

Question

Question

Answer 1

Answer #1

A. $306,667

Contribution margin ratio = Contribution margin / Selling price

Contribution margin ratio = ($80 - $20) / $80

Contribution margin ratio = 0.75 or 75%

Breakeven sales in dollars = Fixed costs / Contribution margin ratio

Breakeven sales in dollars = $230,000 / 0.75

Breakeven sales in dollars = $306,667

Answer 2

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