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M7 CONNECT Homework Problems o 1 Variable per Fixed unit Saved Manufacturing costs: Direct materials $ 40 125 Direct labor 21 Manufacturing overhead $ 900,000 16 Period costs: Selling expenses 3 adninistrative expenses 660,600 Totals points Required: a. What should the company establish as the sales price per unit if it sets a target operating income of $500,000 by producing and References selling 50,000 units during the first year of operations? (Hint: First compute the required contribution margin per unit) b. At the unit sales price computed in part a, how many units must the company preduce and sell to break even? (Assume all units produced are sold)) . What will be the margin of safety (in dollars) if the company produces and sells 50,000 units at the sales price computed in part a? d. Assume that the marketing manager thinks that the price of this product must be ne higher than $100 to ensure market penetration. Will setting the sales price at $100 enable lonic Charge to break even, given the plans to manufacture and sell 50,000 units? Complete this question by entering your answers in the tabs below. Required A | Required B = Required C = Required D What should the company establish as the sales price per unit if it sets a target operating income of $500,000 by producing and selling 50,000 units during the first year of operations? (Hint: First compute the required contribution margin per unit.) F et | 1t Next > Help Save & Exit Submit