In progress Complete the form, then choose the appropriate button at the bottom. Title Assignment #3 Due Oct 2, 2011 12:00 pm Other formulas needed outside of reading material: Sales = Variable expenses + Fixed expenses +Profit Sales = Quantity * Units Profit = (Sales CM ratio) Fixed Cost Review Problems: Contribution margin and ratio Problem 1: (10 points) Sales per unit = $250 Variable Cost per unit = $150 Units = 350 a) Calculate Contribution Margin Per Unit (2 points) b) Calculate Contribution Margin (CM) Ratio Per Unit (3 points) c) Calculate Total Contribution Margin (CM) Dollars (5 points) Problem 2: (5 points) Sales = $5,000,000 CM Ratio = 0.40 Fixed cost = $1,600,000 Calculate Profit. Problem 3: (5 points) A company has budgeted sales of $200,000, a profit of $60,000 and fixed expenses of $40,000. Calculate contribution margin ratio. Review Problem: Break-even point Problem 4: (15 points) Voltar Company manufactures and sells a telephone answering machine. The company's contribution format income statement for the most recent year is given below: Total Per unit Pct. of sales (Ratios) Sales $1,200,000 $60 100% Less variable expenses 900,000 45 ?% -------- -------- -------- Contribution margin 300,000 15 ?% Less fixed expenses 240,000 ====== ====== -------- Net operating income $60,000 ====== a) What is the Contribution Margin (CM) Ratio (or percent of sales)? (5 points) b) Calculate break-even point both in total units and total sales dollars. (10 points) Problem 5: (15 points) Management is anxious to improve the company's profit performance. Assume that next year management wants the company to earn a minimum profit of $90,000. How many units will have to be sold to meet the target profit figure