The Robinson Company sells sports decals that can be personalized with a player\

Question

The Robinson Company sells sports decals that can be personalized with a player's name, a team name, and a jersey number for $4 each. Robinson buys the decals from a supplier for $1.20 each and spends an additional $0.40 in variable operating costs per decal. The results of last month's operations are as follows: What is Robinson's monthly breakeven point in units? In dollars? (Use your answer of breakeven units to calculate the breakeven point in dollars. Round Breakeven units and point in dollar to O decimal places, e.g. 25,000.) By accessing this Question Assistance, you will learn while you earn points based on the Point Potential Policy set by your instructor.

Explanation / Answer

Break even point in units = [ Fixed expenses / Contribution margin per unit ]

= [ 3000 / 4-0.4]

= 833 units

Break even point in dollars = [ Fixed expenses / contribution margin ratio ]

Contribution margin ratio = Contribution / sales

= 4 - 0.4 / 4 = 0.9 or 90%

Break even point in dollars = [ 3000 / 0.9] = 3333.33.

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.