Blackmon Manufacturing Company makes a product that it sells for $50 per unit. The company incurs variable manufacturing costs of $14 per unit. Variable selling expenses are $6 per unit, annual fixed manufacturing costs are $189,000,and fixed and administrative costs are $141,000 per year.
Required
a. Determine the break-even point in units and dollars.
b. Confirm your results by preparing a contribution margin income statement for the break-even sales volume.