Perfect stampers makes and sells aftermarket hub caps. The variable cost for each hub cap is \( \$ 4.75 \), and the hub cap sells for \( \$ 9.95 \). Perfect Stampers has fixed costs per month of \( \$ 3,120 \). Compute the contribution margin per unit and the break-even sales in units and in dollars for the month. Round the contribution margin per unit to two decimal places. Contribution margin Break-even sales in units Break-even sales in dollars

To calculate the contribution margin per unit, subtract the variable cost per hub cap from the selling price: Contribution Margin = Selling Price - Variable Cost Contribution Margin = \( 9.95 - 4.75 = 5.20 \) Next, we find the break-even sales in units by dividing the total fixed costs by the contribution margin per unit: Break-even Sales in Units = Fixed Costs / Contribution Margin Break-even Sales in Units = \( 3,120 / 5.20 \approx 600 \) units Now, to determine break-even sales in dollars, multiply the break-even sales in units by the selling price: Break-even Sales in Dollars = Break-even Sales in Units × Selling Price Break-even Sales in Dollars = \( 600 \times 9.95 = 5,970 \) So, the final results are: Contribution Margin: \( \$ 5.20 \) Break-even Sales in Units: \( 600 \) Break-even Sales in Dollars: \( \$ 5,970 \)