Question

The J&J Company sells a belt having a contribution margin of $3. The president foresees sales up to 200,000 units in the coming period. The company's fixed costs for the period are $255,000.What is the company's break-even point in units?

Answer 1

The J&J Company's break-even point is 85,000 units.

Step-by-step explanation:

To calculate the break-even point in units, we need to divide the fixed costs by the contribution margin. In this case, the fixed costs are $255,000 and the contribution margin is $3. By dividing $255,000 by $3, we find that the break-even point is 85,000 units.