Asked by
ABBIE BERNARDO
on Dec 05, 2024Verified
If the contribution margin is $10, the selling price per unit is $25 and the fixed costs are $45 000, what is the number of units that must be sold to break even?
A) 4500
B) 4000
C) 3000
D) 1800
Selling Price Per Unit
The amount charged to the customer for a single unit of product or service.
Contribution Margin
A financial metric that represents the difference between a company's sales revenue and variable costs, used to cover fixed costs and profits.
Fixed Costs
Costs that do not fluctuate with the level of production or sales within a certain range, such as rent, salaries, and insurance premiums.
- Calculate break-even points in units and in sales dollars.
Verified Answer
SM
Learning Objectives
- Calculate break-even points in units and in sales dollars.