CVP Analysis
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Clyde's Marina has estimated that fixed
costs per month are $300,000 and variable cost per dollar of sales is $0.40.
Required
a. What is the break-even point per month in sales dollars?
b. What level of sales dollars is needed for a monthly profit of $60,000?
c. For the month of July, the marina anticipates sales of $1,000,000. What is the expected level
of profit?
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Solution Summary
The solution explains how to determine the units needed for break-even and for desired profit.
Solution Preview
a. Beakeven point in sales dollars = Fixed cost/contribution margin ratio
Fixed cost = 300,000
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