(i) | Sales | = | $ 60,000 |
Less: | Variable cost | = | $ 39,000 |
(ii) | Contribution margin | = | $ 21,000 |
(ii) / (i) | Contribution margin ratio | = | 35% |
Break-even point in dollars | = | Fixed costs /Contribution margin ratio | |
= | $14700 / 35% | ||
= | $ 42,000 | ||
Therefore, Break-even point in dollars is $42,000 |
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