Apps tureeai Homes D New TabMacmillan Launchpac Question 2 10.00 points The mana

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Apps tureeai Homes D New TabMacmillan Launchpac Question 2 10.00 points The manager of Dukey's Shoe Station estimates operating costs for the yealdil include $495,000 in fixed costs Required a. Find the break-even point in sales dollars with a contribution margin ratio of 40 percent b. Find the break-even point in sales dolars with a contribution margin ratio of 20 percent t 000 for the year assuming a contnibution margin ratio of 40 percent c. Find the sales dotiars required to generate a proft of $150 Search the web and Windows 16 esc 4 5 6 2

Explanation / Answer

a. Break­even point in sales dollars = Fixed costs ÷ Contribution margin ratio

= $495,000 ÷ 0.40 = $1,237,500

b. Break­even point in sales dollars = Fixed costs ÷ Contribution margin ratio

= $495,000 ÷ 0.20 = $2,475,000

c. Sales dollars required = (Fixed costs + Desired profit) ÷ Contribution margin ratio

= ($495,000 + $150,000) ÷ 0.40 = $1,612,500

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