Rooney Company reported the following data regarding the product it sells:Sales priceContribution margin ratio7520%Fixed costs$450,000a. What is the break-even point in dollars? In units?b. To obtain a profit of $45,000, what must the sales be in dollars? In units?

Break even point means a situation where the is neither profit nor loss. Sales revenue is sufficient…

Rooney Company reported the following data regarding the product it sells: Sales price Contribution margin ratio Fixed costs 75 20% $450,000 a. What is the break-even point in dollars? In units? b. To obtain a profit of $45,000, what must the sales be in dollars? In units?

Rooney Company reported the following data regarding the product it sells: Sales price Contribution margin ratio Fixed costs 75 20% $450,000 a. What is the break-even point in dollars? In units? b. To obtain a profit of $45,000, what must the sales be in dollars? In units?

FINANCIAL ACCOUNTING

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ISBN:9781259964947

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Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Question

Rooney Company reported the following data regarding the product it sells:
Sales price
Contribution margin ratio
75
20%
Fixed costs
$450,000
a. What is the break-even point in dollars? In units?
b. To obtain a profit of $45,000, what must the sales be in dollars? In units?

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25.