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Question
Determining the break-even point and preparing a contribution margin income statement. Lucent Manufacturing Company makes a product that it sells for $75 per unit. The company incurs variablemanufacturing costs of$30 per unit. Variable selling expenses are $9 per unit, annual fixed manufacturing costs are $240,000, and fixed selling and administrative costsare $165,000 per year.
Required
Determine the break-even point in units and dollars using each of the following approaches:
a. Equation method.
b. Contribution margin per unit.
c. Confirm your results bypreparing a contribution margin income statement for the break-even sales volume.
Answer must be in Excel and formulas are required
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