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Problem - Break-Even Point and Target Profit Measured in Units (Single Product). Nellie Company has monthly fixed costs totaling $100,000 and variable costs of $20 per unit. Each unit of product is sold for $25.

Required:

1. Calculate the contribution margin per unit?

2. Find the break-even point in units?

3. How many units must be sold to earn a monthly profit of $40,000?

4. Calculate the contribution margin ratio?

5. Find the break-even point in sales dollars?

6. What amount of sales dollars is required to earn a monthly profit of $60,000?

Assume Nellie Company expects to sell 24,000 units of product this coming month.

7. Find the margin of safety in units?

8. Find the margin of safety in sales dollars?

Accounting Basics, Accounting

  • Category:- Accounting Basics
  • Reference No.:- M92572733
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