In 2019, Silva SA had a break-even point of R$350,000 based on a selling price of R$5
Question:
In 2019, Silva SA had a break-even point of R$350,000 based on a selling price of R$5 per unit and fixed costs of R$112,000. In 2020, the selling price and the variable costs per unit did not change, but the break-even point increased to R$420,000.
Instructions
a. Compute the variable costs per unit and the contribution margin ratio for 2019.
b. Compute the increase in fixed costs for 2020.
Contribution MarginContribution margin is an important element of cost volume profit analysis that managers carry out to assess the maximum number of units that are required to be at the breakeven point. Contribution margin is the profit before fixed cost and taxes...
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a Variable cost per unit Unit selling price Unit contribution margin R...View the full answer
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Related Book For 
Accounting Principles
ISBN: 978-1119419617
IFRS global edition
Authors: Paul D Kimmel, Donald E Kieso Jerry J Weygandt
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