testld1837651 Principles of Managerial Accounting Web Summer 2018 Test: Exam 4/F

Question

testld1837651 Principles of Managerial Accounting Web Summer 2018 Test: Exam 4/Final Exam This Question: 1 pt Justin Gladden & 7/27/18 10:45 AM Time Remaining: 01.38.16 Submit Test 9 of 35 (4 complete) This Test: 35 pts Comy and Sweet grows and sells sweet com at its roadside produce stand. The selling price per dozen is $4.75, variable costs are $2.00 per dozer and total fixed costs are $1,925. How many dozens of ears of com must Corny and Sweet sell to breakeven? (Round your final answer to the nearest unit amount.) O A. 3.325 O B. 405 ?.285 O D. 700

Explanation / Answer

Answer: D. 700.

Contribution margin per unit = Selling Price per dozen - Variable Cost per dozen= $ 4.75 - $ 2.00 = $ 2.75.

Break-even sales in units = Total Fixed Cost / Contribution Margin per dozen = $ 1,925 / $ 2.75 = 700 dozens.

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