Answer:
Break-even point (dollars)= $2,218,919
Explanation:
Giving the following information:
Fixed costs= $821,000
Variable costs rate= 63%
If the variable cost rate is 63%, then the contribution margin rate is:
Contribution margin ratio= 1 - 0.63
Contribution margin ratio= 0.37
Now, the break-even point in sales revenue:
Break-even point (dollars)= fixed costs/ contribution margin ratio
Break-even point (dollars)= 821,000 / 0.37
Break-even point (dollars)= $2,218,919
