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Compute the company break-even point in unit sales

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Reference no: EM132908249

Questions -

Q1. Mauro Products has a single product, a woven basket whose selling price is $54, and variable cost is $45 per unit. The company's monthly fixed expenses are $26,550.

Required -

1. Compute the company's break-even point in unit sales using the equation method.

2. Compute the company's break-even point in sales dollars using the equation method and the CM ratio.

3. Compute the company's break-even point in unit sales using the contribution margin method.

4. Compute the company's break-even point in sales dollars using the contribution margin method and the CM ratio.

Q2. Karlik Enterprises has a single product, whose selling price is $24, and variable cost is $18 per unit. The company's monthly fixed expenses are $24,000.

Required -

1. Prepare CVP graph for the company up to a sales level of 8,000 units.

2. Estimate the company's break-even point in unit sales using your CVP graph

Q3. Molander Corporation sells a sun umbrella used at resort hotels. Data concerning the next month's budget are given below:

Selling price $48 per unit

Variable expense $28 per unit

Fixed expense $30,000 per month

Unit sales 2,000 units per month

Required -

1. Compute the company's margin of safety.

2. Compute the company's margin of safety as a percentage of its sales.

Reference no: EM132908249

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