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The contribution margin income statement of Extreme Coffee for March follows: (Click the icon to view the contribution margin income statement.) Extreme Coffee sells
The contribution margin income statement of Extreme Coffee for March follows: (Click the icon to view the contribution margin income statement.) Extreme Coffee sells three small coffees for every large coffee. A small coffee sells for $2.00, with a variable expense of $1.00. A large coffee sells for $4.00, with a variable expense of $2.00. Read the requirements. Requirement 1. Determine the coffee shop's monthly breakeven point in the numbers of small coffees and large coffees. Prove your answer by preparing a summary contribution margin income statement at the breakeven level of sales. Show only two categories of expenses: variable and fixed. Begin by identifying the formula to compute the total breakeven point in units. (Abbreviations used: avg. = Average; CM = Contribution margin.) ( + ) = Breakeven sales in units Now calculate the weighted-average contribution margin per unit. (Round the weighted-average contribution margin per unit to the nearest cent.) Small Large Total Less: Weighted-average contribution margin per unit
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