Sales revenue $600 000 Fixed cost $275 000 Variable cost $270 000 Total cost $545 000 Net income $55 000 Capacity is a sales volume of $800 000. (a) Compute (i) the contribution margin; (ii) the contribution rate. (b) Compute the break-even point (i) in dollars; (ii) as a percent of capacity. (c) Determine the break-even volume in dollars if fixed cost is increased by $40000, while variable cost is held to 40% of sales.
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