Calculating break-even point, contribution margin ratio, and} margin of safety ratio Plaid Enterprises inc. is considering building a manufacturing plant in Scotland. Predicting sales of 100,000 units, Plaid estimates the following expenses:

A Scottish firm that specializes in marketing will be engaged to sell the manufactured product and will receive a commission of \(15 \%\) of the sales price. None of the U.S. home office expense will be allocated to the Scottish facility.
{Required:}
1. If the unit sales price is \(\$ 2\), how many units must be sold to break even?
2. Calculate the margin of safety ratio.
3. Calculate the contribution margin ratio.

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Total Annual Expenses Percent of Total Annual Expenses That Are Fixed Materials $19,000 10% Labor 26,000 20% Overhead 40,000 40% Marketing and administration 14,000 60% $99,000