Effect of converting variable to fixed costs Yule Manufacturing Company reported the following data regarding a product it manufactures and sells. The sales price is $42.

Required
a. Use the per-unit contribution margin approach to determine the break-even point in units and dollars.
b. Use the per-unit contribution margin approach to determine the level of sales in units and dollars required to obtain a profit of $126,000.
c. Suppose that variable selling costs could be eliminated by employing a salaried sales force. If the company could sell 20,000 units, how much could it pay in salaries for salespeople and still have a profit of $126,000?

Variable costs Manufacturing $18 per unit 6 per unit Selling Fixed costs Manufacturing Selling and administrative $150,000 per year 66,000 per year