Problem

(L. OBJ. 2) Computing breakeven sales by the contribution margin approach [15 min] Hang...

(L. OBJ. 2) Computing breakeven sales by the contribution margin approach [15 min]

Hang Ten, Co., produces sports socks. The company has fixed costs of $90,000 and variable costs of $0.90 per package. Each package sells for $1.80.

Requirements

1. Compute the contribution margin per package and the contribution margin ratio.

2. Find the breakeven point in units and in dollars, using the contribution margin approach.

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