Exercise 3-5A (Algo) Contribution margin per unit approach for break-even and desired profit LO 3-1

Information concerning a product produced by Gibson Company appears as follows:

Sales price per unit	$	173
Variable cost per unit	$	87
Total annual fixed manufacturing and operating costs	$	602,000

Required

Determine the following:

1. Contribution margin per unit.

2. Number of units that Gibson must sell to break even.

3. Sales level in units that Gibson must reach to earn a profit of $154,800.