Baljeevans Burgers has sales of 250 units, a sales revenue of textsterling26 500, total variable costs of textsterling12 340 and total fixed costs of textsterling4 600 (all annual figures).Calculate the Contribution Margin PER UNIT.

BREAK EVEN POINT

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Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]

Baljeevans Burgers has sales of 250 units, a sales revenue of £26 500, total variable costs of £12 340 and total fixed costs of £4 600 (all annual figures).Calculate the Contribution Margin PER UNIT.

A	£56.64
B	£14 160
C	£14 410
D	£566.40

Explanation:

Detailed explanation-1: -Break-Even Units = Total Fixed Costs / (Price per Unit-Variable Cost per Unit)

Detailed explanation-2: -The break-even point is the point at which total cost and total revenue are equal, meaning there is no loss or gain for your small business. In other words, you’ve reached the level of production at which the costs of production equals the revenues for a product.

Detailed explanation-3: -To calculate the break-even point in units use the formula: Break-Even point (units) = Fixed Costs ÷ (Sales price per unit – Variable costs per unit) or in sales dollars using the formula: Break-Even point (sales dollars) = Fixed Costs ÷ Contribution Margin.

Detailed explanation-4: -Fixed cost = Total cost of production-(Variable cost per unit x number of units produced)

There is 1 question to complete.

ECONOMICS

COST ACCOUNTING

BREAK EVEN POINT