Answer:
Instructions are below.
Explanation:
Giving the following information:
Khaling Company sold 26,900 units last year at $16.50 each. The variable cost was $11.60, and the total fixed cost was $136,710.
1) Income statement:
Sales= 26,900*16.5= 443,850
Variable costs= 26,900*11.6= (312,040)
Contribution margin= 131,810
Fixed costs= (136,710)
Net operating income= (4,900)
2) To calculate the break-even point in units, we need to use the following formula:
Break-even point in units= fixed costs/ contribution margin per unit
Break-even point in units= 136,710 / (16.5 - 11.6)
Break-even point in units= 27,900units
3) Now, we need to include the desired profit to the break-even point formula:
Break-even point in units= (136,710 + 15,680) / 4.9
Break-even point in units= 31,100 units
