Contribution Margin approach Problem Consider the following

Contribution Margin approach

Problem: Consider the following situation independently. Fill in the blanks with the appropriate information.

number of units sold	total sales	number of units sold	variable cost per unit	contribution margin percentage	total fixed costs	net income	return on sales (NI/Sales)
$20.00				58%		$80,000	8%

Solution

Total sales = 80000/8%= 1000000 Number of units sold =1000000/20= 50000 Variable cost per unit = 20*(1-0.58)= 8.4 Total fixed costs=(1000000*58%)-80000= 500000