Question
Chillmax Company plans to sell 3,500 pairs of shoes at $60 each in the coming year. Variable cost is 35% of the sales price; contribution
Chillmax Company plans to sell 3,500 pairs of shoes at $60 each in the coming year. Variable cost is 35% of the sales price; contribution margin is 65% of the sales price. Total fixed cost equals $78,000 (includes fixed factory overhead and fixed selling and administrative expense).
Required:
1. Calculate the sales revenue that Chillmax must make to break even by using the break-even point in sales equation. $fill in the blank 8fe580072fc4faf_1
Feedback
Break-Even in Sales | = | Total Fixed Expenses |
Contribution Margin Ratio |
Review the "How to Calculate the Break-Even Point in Sales Dollars" example in your text.
2. Prepare a contribution margin income statement based on the break-even point in sales dollars. Enter all amount as a positive number.
Total | |||
Sales | |||
Total variable cost | |||
Total contribution margin | |||
Total fixed cost | |||
Operating income |
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