FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Question
Break-even sales and sales to realize operating income
For the current year ended March 31, Cosgrove Company expects fixed costs of $595,000, a unit variable cost of $50, and a unit selling price of $75.
a. Compute the anticipated break-even sales (units).
fill in the blank 1 units
b. Compute the sales (units) required to realize operating income of $137,500.
fill in the blank 2 units
Expert Solution
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Step 1
The variable cost per unit must be deducted from the selling price per unit in order to calculate the contribution margin per unit.
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