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    Finding the Break-Even Point and Contribution Margin

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    Sammy's Salsa, Inc. sells a single product. This year, 10,000 units were sold resulting in $65,000 of sales revenue, $30,000 of variable costs, and $17,500 of fixed costs.


    a) The number of units that must be sold annually to achieve $52,500 of profits

    b) The break even point

    c) The contribution margin.

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    The solution organises the data in a table order to calculate the figures required, showing the reasoning for each one.