Homework Answers
Contribution margin=Sales-Variable cost
=(18-14)=$4 per unit
Breakeven=Fixed expenses/Contribution margin
=(10400/4)=2600 baskets
=(2600*18)=$46800
New fixed expenses=(10400+600)=$11000
Hence new breakeven=11000/4
=2750 baskets
=(2750*18)=$49500
| Breakeven point in unit sales | 2600 baskets |
| Breakeven point in dollar sales | $46800 |
| Breakeven point in unit sales | 2750 baskets |
| Breakeven point in dollar sales | $49500 |
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Mauro Products distributes a single product, a woven basket whose selling price is $18 per unit...
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