NR 533 WEEK 5 ASSIGNMENT BREAK-EVEN
ANALYSIS CERTIFICATION EVALUATION 2026
QUESTIONS WITH PRACTICE SOLUTION
GRADED A+
◉ fixed expenses. Answer: Expenses that do not change (in total),
such as auto insurance or rent.
◉ variable expenses. Answer: vary from month to month and are
constant on a per-unit basis thus contribution margin per unit is
stable
◉ What would be the revised net operating income per month if the
sales volume increases by 100 units. Answer: variable expenses are
constant on a per-unit basis thus contribution margin per unit is
stable ---> if we are operating within the relevant range so if we
increase sales by 100 units with a CM of $15 per unit we should
anticipate that net income will increase by $1,500 if we are
operating within the relevant range so if we increase sales by 100
units with a CM of $15 per unit we should anticipate that net income
will increase by $1,500
◉ What would be the revised net operating income per month if the
sales volume is 9,000 units. Answer: 9000 units x CM of $15 =
, $135,000 - fix costs $135,000 = NI of $0...BREAKEVEN IS SALES
VOLUME OF 9,000 UNITS OR SALES AMOUNT OF $315,000.
◉ break-even point. Answer: the level of operations in either sales
dollars or units that are needed to result in a contribution margin
that is equal to the fixed expenses of the entity. (THERE IS NO
PROFIT BUT ALSO NO LOSS.)
◉ break even point example. Answer: Karlik Enterprises distributes
a single product whose selling price is $24 per unit and whose
variable expense is $18 per unit. The company's monthly fixed
expense is $24,000.
Contribution Margin = Sales - Var Costs ....here CM is $6 per unit
BE point in units = Fixed costs / CM per unit...here $24,000 / $6 =
4,000 units
BE point in sales = Fixed Costs / CM Ratio (CM / Sales Price)...here
$6 / $24 = 25% CM...thus $24,000 / .25 CM = $96,000 in sales to BE
(proof from above 4,000 units x SP $ 24 = $96,000)
◉ Contribution Margin. Answer: Sales - Variable Costs
◉ Contribution Margin Ratio. Answer: (CM / Sales) or (CM per unit /
SP per unit)
ANALYSIS CERTIFICATION EVALUATION 2026
QUESTIONS WITH PRACTICE SOLUTION
GRADED A+
◉ fixed expenses. Answer: Expenses that do not change (in total),
such as auto insurance or rent.
◉ variable expenses. Answer: vary from month to month and are
constant on a per-unit basis thus contribution margin per unit is
stable
◉ What would be the revised net operating income per month if the
sales volume increases by 100 units. Answer: variable expenses are
constant on a per-unit basis thus contribution margin per unit is
stable ---> if we are operating within the relevant range so if we
increase sales by 100 units with a CM of $15 per unit we should
anticipate that net income will increase by $1,500 if we are
operating within the relevant range so if we increase sales by 100
units with a CM of $15 per unit we should anticipate that net income
will increase by $1,500
◉ What would be the revised net operating income per month if the
sales volume is 9,000 units. Answer: 9000 units x CM of $15 =
, $135,000 - fix costs $135,000 = NI of $0...BREAKEVEN IS SALES
VOLUME OF 9,000 UNITS OR SALES AMOUNT OF $315,000.
◉ break-even point. Answer: the level of operations in either sales
dollars or units that are needed to result in a contribution margin
that is equal to the fixed expenses of the entity. (THERE IS NO
PROFIT BUT ALSO NO LOSS.)
◉ break even point example. Answer: Karlik Enterprises distributes
a single product whose selling price is $24 per unit and whose
variable expense is $18 per unit. The company's monthly fixed
expense is $24,000.
Contribution Margin = Sales - Var Costs ....here CM is $6 per unit
BE point in units = Fixed costs / CM per unit...here $24,000 / $6 =
4,000 units
BE point in sales = Fixed Costs / CM Ratio (CM / Sales Price)...here
$6 / $24 = 25% CM...thus $24,000 / .25 CM = $96,000 in sales to BE
(proof from above 4,000 units x SP $ 24 = $96,000)
◉ Contribution Margin. Answer: Sales - Variable Costs
◉ Contribution Margin Ratio. Answer: (CM / Sales) or (CM per unit /
SP per unit)
