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What is the break-even point in units and sales dollars

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Reference no: EM131810295

Problem - Lindon Company is the exclusive distributor for an automotive product that sells for $37 per unit and has a CM ratio of 34%. The company's fixed expenses are $276,760 per year. The company plans to sell 23,000 units this year.

Requirement 1: What are the variable expenses per unit?

Requirement 2: Use the equation method for the following:

(a) What is the break-even point in units and sales dollars?

(b) What sales level in units and in sales dollars is required to earn an annual profit of $62,900?

(c) Assume that by using a more efficient shipper, the company is able to reduce its variable expenses by $4.0 per unit. What is the company's new break-even point in units and sales dollars?

Reference no: EM131810295

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