Financial management chapter 7

19 View + Chart Mercument we Problem ne Question Problem 2 Question Selling Price Variable Cost Contribution Margin Contribution Margin Ratio $ 12.00 58.00 7 7 Selling price. Variable cost per unit - Contribution margin Contribution margin / Selling price - Contribution margin ratio Selling price Variable cost per unit Contribution margin Contribution margin. Selling price - Contribution margin ratio Total fixed cost Selling price Variable cost per unit) Units sold ADR Vantable Cost Fixed Costs Rooms Sold to Breakeven Breakeven Revenues $80 $15 $100,000 1. Total fixed cost (Selling price Variable cost per unit) Units sold at breakeven 2. Rooms sold to break even Rooms sold per day - Day breakeven occurs 3. Annual fixed costs increase 12 months - Monthly fixed costs increase Total fixed costs (Selling price. Variable cost per unit) - Units sold at breakeven Units sold at breakeven Setting price Breakeven revenues