Head-First Company plans to sell 4,200 bicycle helmets at $67 each in the coming year. Variable cost is 66% of the sales price; contribution margin is 34% of the sales price. Total fixed cost equals $42,585 (includes fixed factory overhead and fixed selling and administrative expense). Required: 1. Calculate the sales revenue that Head-First must make to break even by using the break-even point in sales equation. 2. Check your answer by preparing a contribution margin income statement based on the break-even point in sales dollars.
| Required: | |
| 1. | Calculate the sales revenue that Head-First must make to break even by using the break-even point in sales equation. |
| 2. | Check your answer by preparing a contribution margin income statement based on the break-even point in sales dollars. |
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