XYZ Inc. is a manufacturing company that produces and sells a single product. The company has provided you with the following information for the month of January 2023:

• Sales revenue: $400,000
• Variable costs per unit: $50
• Total fixed costs: $100,000
• Total production: 10,000 units
• Beginning inventory: 2,000 units
• Ending inventory: 1,500 units

a) Calculate the cost of goods sold for the month of January. (4 marks)

b) Calculate the gross profit for the month of January. (4 marks)

c) Calculate the contribution margin per unit. (4 marks)

d) Calculate the breakeven point in units and dollars. (6 marks)

e) Calculate the margin of safety in units and dollars if the company sells 8,000 units. (6 marks)

Answer rating: 100% (QA)

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