Maurice Tutor

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    Argosy University/ Phoniex University/
    Nov-2005 - Oct-2011

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Category > Accounting Posted 19 Aug 2017 My Price 7.00

Head-First Company

Cornerstone Exercise 4-16  Break-Even Point in Sales Dollars

Head-First Company plans to sell 5,000 bicycle helmets at $75 each in the coming year. Variable cost is 60% of the sales price; contribution margin is 40% of the sales price. Total fixed cost equals $49,500 (includes fixed factory overhead and fixed selling and administrative expense).

Required:

1.       Calculate the sales revenue that Head-First must make to break even by using the break- even point in sales equation.

2.       Check your answer by preparing a contribution margin income statement based on the break-even point in sales dollars.

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Maurice Tutor
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Status NEW Posted 19 Aug 2017 01:08 PM My Price 7.00

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