Question

Assume the following information: Amount Per Unit Sales $ 300,000 $ 40 Variable expenses 112,500 15 Contribution margin 187,500 $ 25 Fixed expenses 112,000 Net operating income $ 75,500 The dollar sales to break-even is:

Answer 1

Answer:

$179,200

Explanation:

The computation of the break even point in dollar is shown below:

Break even in dollars is

= Fixed cost ÷ contribution margin ratio

= ($112,000) ÷ ($25 ÷ $40) × 100

= ($112,000) ÷ 62.5%

= $179,200

Hence, the dollar sales to break-even is $179,200

We simply applied the above formula so that the dollar sale with respect to the break even could come

And, the same is to be considered