Darwin Company sells glass vases at a wholesale price of 450

Darwin Company sells glass vases at a wholesale price of $4.50 per unit. The variable cost to manufacture is $1.75 per unit. The monthly fixed costs are $8,250. Its target operating income is $41,250.

What is the contribution margin?

What is the break-even point in units?

How many units must be sold to reach the target income?

Solution

contribution of margin is = $5.50.

break even point = 3000

total units sold by the company to reach the target are = 9166.66