Northern Star sells several products. Information of average revenue and costs is as follows: Selling price per

Question:

Northern Star sells several products. Information of average revenue and costs is as follows:
Selling price per unit.................................$21.00
Variable costs per unit:
Direct material..........................................$6.00
Direct manufacturing labor...........................$1.70
Manufacturing overhead..............................$0.60
Selling costs.............................................$2.00
Annual fixed costs.................................$100,000
The company sells 14,000 units at the end of the year.
1.The per unit is
2. Calculation of Break-even point :-
3. Calculation of Margin of Safety :-
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...