Rosemary is planning to make fancy multi-tiered wedding cakes for the next wed- ding season. To make the cakes, she must invest $834 in some special baking pans and tools. To get started, she needs to spend $1800 to advertise in the newspaper. She estimates that supplies and materials for each cake will cost $60. She is planning to set the price for each cake at $499.
For each of the following, perform a break-even analysis showing computation of the
(a) Contribution margin;
(b) Contribution rate;
(c) Break-even point in units;
(d) Break-even point in sales dollars.