At a price of £32, the estimated monthly sales of a product are 12,000 units. Variable costs include manufacturing costs of £18 and distribution costs of £6. Fixed costs are £40,000 per month.

Required:

Determine each of the following values:
a.Unit contribution margin
b.Monthly break-even unit sales volume
c.Before-tax monthly profit
d.Monthly margin of safety in units

Question

At a price of £32, the estimated monthly sales of a product are 12,000 units. Variable costs include manufacturing costs of £18 and distribution costs of £6. Fixed costs are £40,000 per month.

Required:

Determine each of the following values:
a.Unit contribution margin
b.Monthly break-even unit sales volume
c.Before-tax monthly profit
d.Monthly margin of safety in units

Quizplus · Accepted Answer

The Answer of At a price of £32, the estimated monthly sales of a product are 12,000 units. Variable costs include manufacturing costs of £18 and distribution costs of £6. Fixed costs are £40,000 per month.

Required:

Determine each of the following values:
a.Unit contribution margin
b.Monthly break-even unit sales volume
c.Before-tax monthly profit
d.Monthly margin of safety in units

At a Price of £32, the Estimated Monthly Sales of a Product