# Calculating Contribution Margin and Break Even Point

Not what you're looking for? Search our solutions OR ask your own Custom question.

The following is for a Capital setting:

Fixed cost = $4,000,000

Variable costs per member = $200

Enrollment fee per member = $400

Target profit = $600,000

1. Determine the contribution margin for this practice.

2. Determine the accounting break even point in the terms of number of Enrollees.

3. Determine the economic break even point in terms of number of Enrollees.

Â© BrainMass Inc. brainmass.com March 4, 2021, 10:38 pm ad1c9bdddfhttps://brainmass.com/business/cost-volume-profit-analysis/calculating-contribution-margin-and-break-even-point-348753

#### Solution Preview

1. Determine the contribution margin for this practice.

Variable costs per member =V= $200

Enrollment fee per member =P= $400

Contribution Margin=P-V=400-200=$200 per enrollment

2. Determine the ...

#### Solution Summary

Solution describes the steps to calculate contribution margin and break even point in accounting & economic terms.

$2.49