Question

Information concerning a product produced by Baird Company appears as follows: Sales price per unit Variable cost per unit Total annual fixed manufacturing and operating costs $ 157 $ 87 $469,000 1:48:16 Required Determine the following: a. Contribution margin per unit. b. Number of units that Baird must sell to break even. c. Sales level in units that Baird must reach to earn a profit of $182,000. Book a. Contribution margin per unit b. Break-even in units c. Required sales in units

Answer 1

Solution a) Sales Price Variable cost per unit Contribution Margin $ $ $ 157 87 70 $ Solution b) Break even (units) = Fixed Cost | Contribution margin per unit $ 4,69,000 / $ 70 6700 units = Solution c) Required Sales = (Fixed cost + profit) / Contribution per unit ($ 469,000 + $ 182,000) / $70 $ 6,51,000 / $70 9300 units a b Contribution margin p.us Break even in units Required sales in units 70 6700 9300 С

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