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The Following Information Describes a Product Expected to Be Produced

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Essay

The following information describes a product expected to be produced and sold by Garrison Company:
 Selling price  $ 80 per unit  Variable costs  $ 32 per unit  Total fixed costs $630,000\begin{array}{llr} \text { Selling price } & \text { \$ 80 per unit } \\ \text { Variable costs } & \text { \$ 32 per unit } \\ \text { Total fixed costs } &\$ 630,000\end{array}

Required:
(a) Calculate the contribution margin ratio.
(b) Calculate the break-even point in dollar sales.
(c) What dollar amount of sales would be necessary to achieve a pretax income of $120,000?


Definitions:

Secondary Research

The process of gathering and analyzing data that has already been collected by others, as opposed to primary research.

Electronic Tools

Digital instruments or applications used to facilitate tasks, enhance productivity, or support various activities and processes.

Methodology

The system of methods and principles used in a particular area of study or activity.

Citation

A reference to a source of information, used to give credit to the original author or to provide evidence for a claim.

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