At a sales level of 10,000 units, Darly Corporation has variable costs of $40,000, fixed costs...

At a sales level of 10,000 units, Darly Corporation has variable costs of $40,000, fixed costs of $48,000, and sales of $80,000. Calculate the sales level that would put the company at its break-even point. A - What is the selling price per unit? $ B - What is the variable cost per unit? $ C - What is the unit contribution margin? $ D - What is the break-even point in units? E - What is the break-even point in sales dollars? $

Expert Solution

Working for requirement A,B and C
	Total (A)	Units sold (B)	Per unit (A/B)
sales	$ 80,000.00	10000	$ 8.00
variable cost	$ 40,000.00	10000	$ 4.00
Contribution Margin	$ 40,000.00	10000	$ 4.00
Fixed cost	$ 48,000.00
Net income / (loss)	$ (8,000.00)

Requirement A

Selling price per Unit= $8

Requirement B

Variable cost per Unit = $4

Requirement C

Unit Contribution margin = $4

Requirement D

A	Sale Price per unit	$ 8.00
B	Variable Cost per Unit	$ 4.00
C=A x B	Unit Contribution	$ 4.00
D	Total Fixed cost	$ 48,000.00
E=D/C	Breakeven point in units	12000

Breakeven in units = 12,000

Requirement E

A	Sale Price per unit	$ 8.00
B	Variable Cost per Unit	$ 4.00
C=A x B	Unit Contribution	$ 4.00
D	Total Fixed cost	$ 48,000.00
E=D/C	Breakeven point in units	12000
F= E x A	Breakeven in sales dollars	$ 96,000.00

Breakeven point in sales dollars= $96,000

ekkarill92 answered 2 years ago

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