A company expects to sell 75,000 widgets at a price of $10.00. The unit variable costs are

Question:

A company expects to sell 75,000 widgets at a price of $10.00. The unit variable costs are estimated at $8.00, and the fixed costs are estimated at $125,000. On the basis of this information, calculate the following:
1.
2. PV ratio
3. Revenue break-even by using the PV ratio
4. Profit generated Contribution Margin
Contribution margin is an important element of cost volume profit analysis that managers carry out to assess the maximum number of units that are required to be at the breakeven point. Contribution margin is the profit before fixed cost and taxes...