CD Solutions Ltd. manufactures and replicates CDs for software and music recording companies. CD Solutions sells each disc for $2.50. The variable costs per disc are $1.00.
a. To just break even, how many CDs must be sold per month if the fixed costs are $60,000 per month?
b. What must sales be in order to have a profit of $7500 per month?
Use the graphical approach to CVP analysis to solve the problem.