Question: Scott Confectionery sells its Stack-o-Choc candy bar for $0.80. The variable cost per unit for the candy bar is $0.45; total fixed costs are $175,000.

Scott Confectionery sells its Stack-o-Choc candy bar for $0.80. The variable cost per unit for the candy bar is $0.45; total fixed costs are $175,000.

Required

a. What is the contribution margin per unit for the Stack-o-Choc candy bar?

b. What is the contribution margin ratio for the Stack-o-Choc candy bar?

c. What is the breakeven point in units? In sales dollars?

d. If an increase in chocolate prices causes the variable cost per unit to increase to $0.55, what will happen to the breakeven point?

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