Natalia is excited, as she has just reached her break-even point. The selling price per unit of the rubber exercise ball she developed is $28. At this sales volume, her variable cost is $7, while her fixed cost is $12 per unit. When Natalia sells one more unit, she will generate additional income of

Question

Quizplus · Accepted Answer

The contribution margin per unit is $21 (sales price of $28 less variable cost of $7). The $12 fixed cost per unit is irrelevant in this problem.

Natalia Is Excited, as She Has Just Reached Her Break-Even