Maruca Corporation has provided the following contribution format income statement. Assume that the following information is within the relevant range. The break-even point in dollar sales is closest to:

Question

Maruca Corporation has provided the following contribution format income statement. Assume that the following information is within the relevant range.  The break-even point in dollar sales is closest to:

Quizplus · Accepted Answer

CM ratio = Contribution margin ÷ Sales = $94,500 ÷ $270,000 = 35%
Dollar sales to break even = Fixed expenses ÷ CM ratio = $86,100 ÷ 35% = $246,000

Maruca Corporation Has Provided the Following Contribution Format Income Statement