Break-Even Sales and Sales to Realize Income from Operations For the current year ended October 31,...
Break-Even Sales and Sales to Realize Income from Operations
For the current year ended October 31, Friedman Company expects fixed costs of $550,000, a unit variable cost of $52, and a unit selling price of $77.
a. Compute the anticipated break-even sales
(units).
units
b. Compute the sales (units) required to
realize income from operations of $127,500.
units
Homework Answers
a) Break even unit = Fixed cost/Contribution margin per unit = 550000/(77-52) = 22000 Units
b) Required unit = (Fixed cost+desired profit)/Contribution margin per unit = (550000+127500)/25 = 27100 Units
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Break-Even Sales and Sales to Realize Income from Operations
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