# Compute contribution margin, break-even point, and margin of safety

Aug 26th, 2015
DotaCN
Category:
Accounting
Price: \$10 USD

Question description

In the month of June, Jose Herbert's Beauty Salon gave 4,000 haircuts, shampoos, and permanents at an average price of \$30. During the month, fixed costs were \$16,800 and variable costs were 75% of sales.

Instructions:

a. Determine the contribution margin in dollars, per unit and as a ratio.

b. Using the contribution margin technique, compute the break-even point in dollars and in units.

c. Compute the margin of safety in dollars and as a ratio.

(Top Tutor) Daniel C.
(997)
School: New York University

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