Answer:

At break-even point the total fixed costs are equal to the total contribution margin. So the total fixed costs are already covered by the break-even units. In a relevant range the fixed cost does not change as per the changes in the volume of production. So if a company produces more than the break-even units, its fixed cost will remain same.

So if a company produces units above the break-even point, automatically the contribution margin per unit becomes the profit per unit above the break-even point.

Answer:

The statement is "The busier we are, the more we lose", means if the restaurant generates huge sale in the day will get huge loss.

If we compile this statement to "contribution margin (Sales- variable cost)", I understood that "the selling price should have been lower than the variable cost" otherwise the more contribution margin should more profit.

Answer:

1. The Break even is appoint where there is no profit or loss, hence it shall be calculated by using following formula:

Hence applying the above formula we get:

2. The operating income if 46,775 grills shall be sold in following manner:

In the above solution, in case of variable costing the profit shall be 17,540,625 as the fixed costs are ignored in variable costing while in absorption costing the profit shall be 1,205,625.3. The new break-even point if variable costs are increased to 240 per grill shall be calculated in following manner:

Hence applying the above formula we get:

All the values are in $.