berlino corporation sells coffee makers for $33 each and has fixed costs of $10,200 and variable costs of $16 per unit
a. compute the contribution margin per unit $_____
b. compute the breakeven quantity___ (no commas, only enter amount)
c. compute the breakeven sales amount ____ (no commas, only enter amount)
As we know that:
Contribution per unit= Selling price per unit - variable cost per unit,
Break-even quantity = Fixed Cost/ Contribution margin per unit &
Break-even sales amount = Break-Even quanitity* selling price per unit. Therfore,
a. Computation of contribution margin per unit:
Particulars | $ | |
Selling Price | A | 33 |
Less: Variable cost per unit | B | 16 |
Contribution Margin | C=A-B | 17 |
b. Computation of breakeven quantity in units:
Particulars | $ | |
Fixed Costs | A | 10200 |
Contribution Margin | B | 17 |
Break even quantity(units) | C=A/B | 600 |
c. Computation of breakeven sales amount:
Particulars | $ | |
Break even quantity | A | 600 |
Selling Price per unit | B | 33 |
Break even sales amount | C=A*B | 19800 |
THEREFORE,
a. compute the contribution margin per unit $ 17
b. compute the breakeven quantity 600
c. compute the breakeven sales amount 19800
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