Bandaleria Company's projected profit for the coming year is as follows:

Required:
1. Compute the break-even point in units.
2. How many units must be sold to earn a profit of $640,000?
3. Compute the contribution margin ratio. Using that ratio, compute the additional profit that Bandaleria would earn if sales were $50,000 more than expected.
4. For the projected level of sales, compute the margin of safety inunits.

Transcribed Image Text:

Total Per Unit $20 Sales Less: Variable expenses $2,480,000 1,488,000 $ 992,000 Contribution margin $ 8 Less: Fixed expenses 716,800 Operating income $275,200