Jethro recently fulfilled his long-time dream of opening a gym that offers spinning exercise classes for $10 per person. To differentiate his gym and better serve his clients, Jethro provides a towel, a bottle of water, and an after-work out protein shake to each person participating in a class, at a cost of $2.65 per person. Jethro employs four part-time instructors and pays them each $1,500 per month. He also pays himself a monthly salary of $6,500. Jethro's other monthly costs are $1,800 for rent, $1,350 for depreciation on his 30 bikes, and $1,425 in utilities and insurance.

Required

(a) What is Jethro's contribution margin per unit?

(b) What is Jethro's contribution margin ratio?

(c) Prepare Jethro's monthly contribution format income statement. Assume that he teaches 4,500 clients