Squeeze Me Company produces Beanie Babies. Each doll sells for $20.00. Variable costs per unit total $14.00, of which $6.25 is for direct materials and $5.25 is for direct labor. If total fixed costs are $435,000, then the break- even point is:
A) 72,500 dolls
B) 51,176 dolls
C) 31,071 dolls
D) 21,750 dolls

Question

Quizplus · Accepted Answer

Explanation:Contribution Margin per unit = $20.00 - $14.00 = $6.00Break-even point = 435,000 / 6.00 = 72,500 dolls

Squeeze Me Company Produces Beanie Babies