Computing Break$-$Even and Margin $of$ Safety

Assume that last year, Cliff Consulting, a firm $in$ Berkeley, $CA,$ had the following contribution income statement.

REQUIRED

$a.$ Determine the annual break$-$even point $in$ sales revenue.$\frac{?}{\text{\$}}$

$b.$ Determine the annual margin $of$ safety $in$ sales revenue.$\frac{?}{\text{\$}}$

$c.$ What $is$ the break$-$even point $in$ sales revenue $if$ management makes a decision that increases fixed costs $by\frac{?}{(\frac{?}{?}\text{\$}80,000\frac{?}{?})}?\frac{?}{\text{\$}}$

Note: Round $upto$ the nearest dollar, enter $\frac{?}{(\frac{?}{?}\text{\$}80\frac{?}{?})}$ for $\frac{?}{(\frac{?}{?}\text{\$}79\mathrm{.}2\frac{?}{?})}$

$d.$ With the current cost structure, including fixed costs $of$ $$440,000,$ what dollar sales revenue $is$ required $to$ provide a before$-$tax profit $of$ $$350,000?$

$

Note: Round $upto$ the nearest dollar, enter $$80$ for $$79\mathrm{.}2$

$e.$ Prepare $an$ abbreviated contribution income statement $to$ verify that the solution $to$ requirement $d$ will provide the desired before$-$tax profit.

Note: Round all answers $to$ the nearest dollar, enter $$49$ for $$49\mathrm{.}3,or$ $$50$ for $$49\mathrm{.}7$