The break-even point in sales dollars can be calculated by dividing

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The break-even point in sales dollars can be calculated by dividing the fixed expenses by the contribution margin ratio. This ratio is calculated by subtracting variable expenses per unit from the unit selling price, and then dividing the result by the unit selling price. The contribution margin represents the amount of revenue that is left over after variable expenses have been deducted, so it is the portion of each sale that contributes to covering the fixed expenses. The contribution margin ratio gives us the portion of each sale that is contributed to fixed expenses, so dividing fixed expenses by this ratio gives us the sales level required to cover fixed expenses.

The Break-Even Point in Sales Dollars Can Be Calculated by Dividing