First identify the formula to compute the sales in units at various levels of operating income using the contribution margin approach. (Abbreviations used: Avg. = average, and CM = contribution margin.) ( + ) / = Breakeven sales in units

10 stand scooters and 15 chrome scooters

Explanation:

Data:

The margin approach:

(Fixed expenses + Operating income)/ Weighted average CM per unit = Break even sales in units.

Tallying from the tables, the types and quantities that need to be sold will be like this:

Standard scooters  = 10

Chrome scooters    = 15

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