Sales | $155.00 |
Variable expense | $124.00 |
Contribution margin | $31.00 |
Contribution = sales-variable cost.
Contribution margin = contribution/sales
Break even point unit = total fixed cost/contribution
a) contribution = $31
b) Contribution margin = 31/155 = 20%
c) Break even point units = 480500/31 = 15,500 units
d) Break even sales = Break even units x selling price = 15,500 x 155 = $2,402,500.
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