Calculate the contribution margin ratio

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Question - The following information describes a product expected to be produced and sold by Hadley Company:

Selling Price - $80 per unit

Variable costs - $32 per unit

Total fixed costs - $630,000

Required:

(a) Calculate the contribution margin ratio.

(b) Calculate the break-even point in dollar sales.

(c) What dollar amount of sales would be necessary to achieve a pretax income of $120,000?

Reference no: EM131763636

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