Homework Answers
Reduction in the break-even sales in units
Reduction in the break-even sales in units = Decrease in fixed costs / Contribution margin per unit
= Decrease in fixed costs / (Selling price per unit – Variable cost per unit)
= $4,080 / ($40.00 per unit - $10.00 per unit)
= $4,080 / $30.00 per unit
= 136 units
Therefore, the Reduction in the break-even sales in units will be “Decrease by 136 units”
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