Exercise 19-10 (Part Level Submission) In the month of March, Style Salon servic

Question

Exercise 19-10 (Part Level Submission) In the month of March, Style Salon services 610 clients at an average price of $140. During the month, fixed costs were $21,462 and variable costs were 65% of sales. Your answer is correct. Determine the contribution margin in dollars, per unit, and as a ratio. (Round answers to O decimal places, e.g. 1,225.) Contribution margin Contribution margin per unit 29890 49 Contribution margin ratio SHOW SOLUTION SHOW ANSWER LINK TO TEXT LINK TO TEXT Attempts: 1 of 3 used

Explanation / Answer

b) Break even sales = Fixed costs/Contribution margin ratio

= $21,462/35% = $61,320

Break even units = Fixed costs/Contribution margin per unit

= $21,462/$49 per unit = 438 units

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