Amount Descriptions Unit Bre Unit Break-Even Point Instructions Head-First Compa

Question

Amount Descriptions Unit Bre Unit Break-Even Point Instructions Head-First Company plans to sell 4,700 bicycle helmets at $75 each in the coming year. Unit variable cost is $46 (includes direct materials, direct labor, variable factory overhead, and variable selling expense). Total fixed cost equals $46, 110 (includes fixed factory overhead and fixed selling and administrative expense) Required: 1. Calculate the break-even number of helmets. 2. Check your answer by preparing a contribution margin income statement based on the break-even units. Unit Break-Even Point Shaded cells have feedback 1. Calculate the break-even number of helmets 1,590 V helmets Points1/1

Explanation / Answer

1.

2.

Breakeven point in unit = Fixed costs / (Selling price per unit - Variable cost per unit) Breakeven point in unit = $46,110 / ($75-$46) Breakeven point in unit = 1,590 Units

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