In a normal month, the Whitewater Company generates total sales of $25,000. To do so they incur variable costs of $15,000 and fixed costs of $10,000.
Required: Calculate each of the following:
A. Variable cost ratio
B. Contribution margin ratio
C. Monthly break-even point in dollar sales
D. Monthly margin of safety in dollars

Question

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The Answer of In a normal month, the Whitewater Company generates total sales of $25,000. To do so they incur variable costs of $15,000 and fixed costs of $10,000.
Required: Calculate each of the following:
A. Variable cost ratio
B. Contribution margin ratio
C. Monthly break-even point in dollar sales
D. Monthly margin of safety in dollars

In a Normal Month, the Whitewater Company Generates Total Sales