$3.$ Contribution Margin Income Statement of a single product company

Total Per unit

Sales $$1,200,000$ $$80$

Less variable expenses $$840,000$ $$56$

Contribution Margin $360,000$ $$24$

Less fixed expenses $300,000$

Net Operating income $$60,000$

Required:

$1.$ Calculate break$-$even point in units and dollars.

$2.$ What is the contribution margin at break$-$even point?

$3.$ Compute the number of units to be sold to earn a profit of $$36,000.$

$4.$ Compute the margin of safety using original data.

$5.$ Compute CM ratio. Compute the expected increase in monthly net operating if sales increase by $$160,000$ and fixed expenses do not change.