Dental Comfort Services provides dental cleanings to its patients. The selling price of a cleaning is $150 and the variable costs associated are $85. The monthly relevant fixed costs are $10,000.
Required:
a. What is the breakeven point in cleanings?
b. What is the margin of safety in dollars, assuming sales total $30,000?
c. What is the breakeven level in cleanings, assuming variable costs decrease by 20%?
d. What is the breakeven level in dollars, assuming the selling price goes down by 10% and fixed costs increase $1,000 per month?

Question

Quizplus · Accepted Answer

The Answer of Dental Comfort Services provides dental cleanings to its patients. The selling price of a cleaning is $150 and the variable costs associated are $85. The monthly relevant fixed costs are $10,000.
Required:
a. What is the breakeven point in cleanings?
b. What is the margin of safety in dollars, assuming sales total $30,000?
c. What is the breakeven level in cleanings, assuming variable costs decrease by 20%?
d. What is the breakeven level in dollars, assuming the selling price goes down by 10% and fixed costs increase $1,000 per month?

Dental Comfort Services Provides Dental Cleanings to Its Patients