Compute break-even sales using the contribution margin ratio

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Reference no: EM131213031

Erickson, Inc. makes student book bags that sell for $20 each. For the coming year, management expects fixed costs to be $225,000. Variable costs are $15 per unit.

Instructions (a) Compute break-even sales in dollars using the mathematical equation.

(b) Compute break-even sales using the contribution margin ratio.

(d) Compute the sales required to earn net income of $150,000, using the mathematical equation.

Reference no: EM131213031

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