What is obtained when the fixed costs are divided by the contribution margin per unit?

Multiple choice question for Cost Volume Profit Analysis. Select an option, then review the explanation below.

Explanation

Dividing fixed costs by the contribution margin per unit calculates the break-even number of units, which is the amount of units that must be sold to cover all fixed expenses.

Practice related questions from the same subject.

1.Given a contribution margin ratio of 30% and a selling price of $5,000, what is the contribution margin amount for each unit?
2.Given a contribution margin of $13,000 and total variable costs amounting to $7,000, what is the total revenue?
3.Given a selling price of $5000 and a contribution margin per unit of $1000, what is the contribution margin percentage?
4.Given a revenue of $15,000, variable costs totaling $5,000, and fixed costs amounting to $2,000, what is the operating income?
5.Given that the total revenue amounts to $9,000 and the total variable costs are $2,000, what is the contribution margin?

What is obtained when the fixed costs are divided by the contribution margin per unit?

Explanation

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