Question
The following is Arkadia Corporation's contribution format income statement for last month: Sales $1,200,000 Less variable expenses 800,000 Contribution margin 400,000 Less fixed expenses 300,000
The following is Arkadia Corporation's contribution format income statement for last month:
| Sales | $1,200,000 |
| Less variable expenses | 800,000 |
| Contribution margin | 400,000 |
| Less fixed expenses | 300,000 |
| Net income | $ 100,000 |
The company has no beginning or ending inventories and produced and sold 20,000 units during the month.
Required:
a. What is the company's contribution margin ratio?
b. What is the company's break-even in units?
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Hospitality Financial Accounting
Authors: Jerry J. Weygandt, Donald E. Kieso, Paul D. Kimmel, Agnes L.
2nd Edition
9780470598092, 470083603, 978-0470083604
