What is the total contribution margin at break even point

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Reference no: EM131150500

Clock Company sells a single product. The company's sales and expenses for a recent month follow:

TOTAL PER UNIT

Sales $600,000 $40

Les Variable Expenses 420,000 28

Contribution Margin 180,000 $12

Less fixed expenses 150,000

Net Operating Income $30,000

a) What is the monthly break-even point in units sold AND in sales dollars?

b) Without resorting to computations, what is the total contribution margin at the break even point?

c) How many units would have to be sold each month to earn a minimum target profit of $18,000? Use the Contribution Margin Method. Verify your answer by Preparing a Contribution Income Statement at the target level of sales.

Reference no: EM131150500

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