If the variable cost per unit is $30.00, the break-even in sales dollars is $64,000, and fixed costs are $40,000, the selling price per unit is

Question

Quizplus · Accepted Answer

Break-even sales = Fixed costs / Contribution margin ratio

Contribution margin ratio = (Selling price per unit - Variable cost per unit) / Selling price per unit

$64,000 = $40,000 / [(Selling price per unit - $30.00) / Selling price per unit]

Solving for Selling price per unit:

Selling price per unit = $80.00

If the Variable Cost Per Unit Is $30