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sturgis llc sells cars and trucks. The unit sales for trucks were 100,000 and the contribution margin was 200,000. For cars the unit sales were 120,000 and the contribution margin was 240,000. If fixed costs are 220,000 how many cars are needed to breakeven? A) 59,500 B) 60,500 C) 61,500 D) None of the above
Expert Answer
Breakeven (units)=Fixed costs/(Seling price-variable cost per unit)
Seling price-variable cost per unit= Contribution margin/no of unit sales
=240000/120000=2
Breakeven (units)=220000/2
=110,000
It is option D.
