Answer:
Instructions are listed below
Explanation:
Giving the following information:
selling price= $75
variable costs per unit of $30
The monthly fixed expenses are $22,500.
a) Break-even point= fixed costs/ contribution margin
Break-even point= 22,500/(75 - 30)= 500 units
b) Break-even point (dollars)= fixed costs/ contribution margin ratio
Break-even point (dollars)= 22,500/(45/75)= $37,500
c) Contribution margin income statement:
Sales= 75*900= 67,500
Variable cost= 900*30= (27,000)
Contribution margin= 40,500
Fixed costs= (22,500)
Net operating income= 18,000
d) Profit= 45,000
Break-even point= (fixed costs + target profit)/ contribution margin
Break-even point= 67,500/45= 1,500 units
e) Break-even point (dollars)= (fixed costs + target profit)/ contribution margin ratio
Break-even point (dollars)= 67,500/(45/75)= $112,500
f) Contribution margin income statement:
Sales= 150,000
Variable costs= (2,000*30)= (60,000)
Contribution margin= 90,000
Fixed costs= (22,500)
Net operating income= 67,500
