Without resorting to computations, the total contribution margin at the break-even point is $146,400.
The contribution margin can be either in gross or per-unit terms.
After deducting the variable portion of the firm's costs, it represents the incremental revenues earned for each product/unit sold.
The contribution margin is calculated as follows:
[tex]contribution margin = Selling Price Per Unit - Variable Cost Per Unit[/tex].
Dollar contribution per unit indicates how the overall company's profit is impacted by a specific product.
It not only shows the part of the revenue that helps to cover the company's fixed costs.
But also it provides a way to show the profitability of a specific product offered by a company.
Profit is defined as whatever income that remains after paying fixed costs.
Also, at the break-even point,[tex]the contribution margin = fixed costs.[/tex]
Therefore,
the total contribution margin at the break-even point = $146,400
Hence, the correct answer is $146,400.
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