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Menlo Company distributes a single product. The company’s sales and expenses for last month follow:
Required:

What is the monthly breakeven point in unit sales and in dollar sales?

Without resorting to computations, what is the total contribution margin at the breakeven point?
a. How many units would have to be sold each month to attain a target profit of $29,400?
b. Verify your answer by preparing a contribution format income statement at the target sales level.
4. Refer to the original data. Compute the company’s margin of safety in both dollar and percentage terms.
5. What is the company’s CM ratio? If sales increase by $70,000 per month and there is no change in fixed expenses, by how much would you expect monthly net operating income to increase?
Breakeven point may be described as the number of amount of sales that a company must make to pay for the costs. At breakeven the business will have earned enough cash that it would be in the noloss, noprofit situation.
= $21,000.