Blanchard Company manufactures a single product that sells for $195 per unit and whose total variable...

Blanchard Company manufactures a single product that sells for $195 per unit and whose total variable costs are $156 per unit. The company’s annual fixed costs are $510,900.

(a) Compute the company's contribution margin per unit.


	Contribution margin
(b) Compute the company's contribution margin ratio.
	Choose Numerator:	/	Choose Denominator:	=	Contribution Margin Ratio
		/		=	Contribution margin ratio

(c) Compute the company's break-even point in units.
	Choose Numerator:	/	Choose Denominator:	=	Break-Even Units
		/		=	Break-even units

(d) Compute the company's break-even point in dollars of sales.
	Choose Numerator:	/	Choose Denominator:	=	Break-Even Dollars
		/		=	Break-even dollars

Blanchard Company manufactures a single product that sells for $160 per unit and whose total variable costs are $128 per unit. The company’s annual fixed costs are $464,000.

(1) Prepare a contribution margin income statement for Blanchard Company showing sales, variable costs, and fixed costs at the break-even point.
(2) Assume the company’s fixed costs increase by $130,000. What amount of sales (in dollars) is needed to break even?

Prepare a contribution margin income statement for Blanchard Company showing sales, variable costs, and fixed costs at the break-even point.

BLANCHARD COMPANY
Contribution Margin Income Statement (at Break-Even)
	Amount	Percentage of sales

Assume the company’s fixed costs increase by $130,000. What amount of sales (in dollars) is needed to break even?

Break-Even Point in Dollars
Choose Numerator:	/	Choose Denominator:	=	Break-Even Point in Dollars
	/		=	Break-even point in dollars

Solutions

Expert Solution

ekkarill92 answered 1 year ago

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