Unit 4 Lab-Principles of Accounting II

Henning Co. estimates that variable costs will be 70% of sales and fixed costs will total $2,160,000. The selling price of the product is $10, and 750,000 units will be sold. Using the mathematical equation,

Compute the break-even point in units and dollars.

Break-even point (in units)			units
Break-even point (in dollar)		$

Compute the margin of safety in dollars and as a ratio.

Margin of safety in dollars		$
Margin of safety ratio			%

Compute net income.

Net income

$