The Shields Company produces a product that sells for $7. Variable costs are $2.10 per unit, while fixed costs per period are $28,000. The contribution margin ratio and break-even point in dollars, respectively, are:
A. 70%; $40,000
B. 30%; $40,000
C. 30%; $56,000
D. 70%; $56,000
2. The Billings Corporation produces and sells watches. The selling price is$11 per watch. Fixed costs are $4,000. Variable costs are $10 per watch. What is the break-even point in units?
A. 10,000 units
B. 5,000 units
C. 4,000 units
D. 400 units