Question: 1. (a). What is break even point, explain with a good example and a diagram. (b). A company sells a product at $35 per unit.

1. (a). What is break even point, explain with a good example and a diagram.

(b). A company sells a product at $35 per unit. The variable cost for the product is $30 per

unit and its fixed cost is $70,000

i) what is the quantity the firm must sell to break even

ii) what is the break even point in dollars

c). A vehicle spare parts dealer has the following information in her operating budget.

Sales were $1,020.000 with fixed costs for the period of $160,000. The total variable cost

was $581,400. Find:

i, The contribution margin

ii Contribution rate

iii Break even point in sales dollars

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