Ploeger Corporation has provided the following contribution format income statement. Assume that the following information is within the relevant range.

Sales (4,000 units) $ 240,000
Variable expenses 156,000
Contribution margin 84,000
Fixed expenses 81,900
Net operating income $ 2,100

The question is missing the below options:

The break-even point in dollar sales is closest to:

a$234,000

b$237,900  

c$156,000  

d $0

The break-even sales is $234,000,option A, as shown by the calculation below.

At break-even,total revenue is equal total costs, no gain or loss is recorded.

Explanation:

Particulars             Amt

Sales (4,000 units)    $240,000

Variable expenses     $156,000

Contribution margin   $84,000

Contribution Margin  Ratio =Contribution/Sales =(X)35.00%

Fixed expenses (Y)     $81,900

Break Even Sale (Y/X)$234000

the answer is d.

by: nicholas dooley