Answer:
the contribution margin per unit of the product is $29.7
Explanation:
to calculate fixed cost per unit, you will divide the total fixed cost by the number of unit of product. i.e $39,480/1330units = $29.7 per unit
variable cost per product is $5,607/1330units = $4.2 per unit
selling price = 33.9 i.e fixed cost + variable cost
solution
selling price per unit= 33.9
less V.C 4.2
contribution margin 29.7
fixed cost per unit 29.7
0
the account is at break-even point
Answer:
Approximately $29.68
Explanation:
First, determine the unit price of products.
In this case depreciation expense is a fixed cost, because it recurs in the same amount per period throughout the useful life of the project.
Total cost/Total products ($39450+$5607/1330)
= $33.9 (unit price per product)
Second, determine Contribution Margin (CM) =
Unit price of products - Total Variable cost per unit (TVC per unit)
where TVC per unit= Total Variable cost/ Total Products
CM= $33.9-$5607/1330 = $29.68 approximately.
To confirm BEP:
Fixed Cost/Contribution Margin
$38480/$29.68= $1330
