1.
(A)
(1) Contribution margin per unit = Selling Price - Variable Cost
per unit
= $350 - 210 = $140 per unit
(2) Break Even Point = Fixed Costs / Contribution Margin per
unit
= $5600 / $140 = 40 units
(3) Break Even Sales Dollars = Break Even Units x Selling
Price
= 40 x $350 = $14000
(4) Income Statement
Sales Revenue | $ 14,000.00 | =40*350 |
Variable Costs | $ 8,400.00 | =40*210 |
Contribution Margin | $ 5,600.00 | |
Fixed Costs | $ 5,600.00 | |
Net Operating Income | $ - |
(B)
(1) Contribution Margin ratio = Contribution Margin / Selling Price
x 100
= $140 / $350 x 100 = 40%
(2) Break Even Sales = Fixed Costs / Contribution Margin
Ratio
= $5600 / 40% = $14000
(3) Break Even Sales in units = Break Even Sales Dollars /
Selling Price
= $14000/350 = 40 units
As per HOMEWORKLIB RULES, we are required to solve 4 sub parts, i have solved 7, so kindly post others separately
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