To calculate what, fixed cost is divided into contribution margin per unit?

Solution(By Examveda Team)

To calculate breakeven number of units, fixed cost is divided into contribution margin per unit. A break-even analysis is a financial tool which helps you to determine at what stage your company, or a new service or a product, will be profitable. In other words, it’s a financial calculation for determining the number of products or services a company should sell to cover its costs (particularly fixed costs). Break-even is a situation where you are neither making money nor losing money, but all your costs have been covered.