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Hello,
formula for breakeven point =total FC/contribution per unit (and this is clear).
But in this exam instead of contribution per unit, they use C/S ratio (that was given in question, 40%).
Is there any rule when to use which, and situation is one product? (when mix we use average).
Also, I did watch your lectures, but this I did not catch.
Thank you in advance,
The formula you quote give the breakeven point in units.
For breakeven revenue you either divide fixed overheads by the C/S ratio, or alternatively you can calculate the break even point in units and then multiply by the revenue per unit.
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