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3 years ago

Adams Company sells a product whose contribution margin is $10 and selling price is $25.

Business

1 answer:

Karolina [17]3 years ago

6 0

Answer:

answer is b) False

Explanation:

given data

contribution margin = $10

selling price = $25

total fixed costs = $500

break-even point = 100 units

solution

we get here Break even point that is

Break even point = $\frac{fix\ cost}{contribution\ margin}$ ...........1

Break even point = $\frac{500}{10}$

Break even point = 50 units

but we have given break-even point is 100 units

so answer is b) False

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Answer: The following journal entries apply:

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Answer:

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