Zebra Company manufactures custom-designed skins (covers) for iPods and other portable MP3 devices. Variable costs are $10.80

Question:

Zebra Company manufactures custom-designed skins (covers) for iPods® and other portable MP3 devices. Variable costs are $10.80 per custom skin, the price is $16, and fixed costs are $66,560.
Required:
1. What is the for one custom skin?
2. How many custom skins must Zebra Company sell to break even?
3. If Zebra Company sells 13,000 custom skins, what is the operating income?
4. Calculate the margin of safety in units and in sales revenue if 13,000 custom skins are sold.
Contribution Margin
Contribution margin is an important element of cost volume profit analysis that managers carry out to assess the maximum number of units that are required to be at the breakeven point. Contribution margin is the profit before fixed cost and taxes...