Question

Volodya Company reported the following data regarding the product it sells:
Sales price ............ $20
Contribution margin ratio ...... 40%
Fixed costs ............ $900,000
Required
Use the contribution margin ratio approach and consider each requirement separately.
a. What is the break-even point in dollars? In units?
b. To obtain a profit of $360,000, what must the sales be in dollars? In units?
c. If the sales price increases to $24 and variable costs do not change, what is the new break-even point in dollars? In units?



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  • CreatedFebruary 07, 2014
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