Air Peanut Company manufactures and sells roasted peanut packets to commercial airlines. Following are the price and cost data per 100 packets of peanuts:

Required

a. Determine Air Peanut's breakeven point in units.

b. How many packets does Air Peanut have to sell to earn \(\$ 156,000\) ?

c. Air Peanut expects its direct labor costs to increase by \(5 \%\) next year. How many units will it have to sell next year to break even if the selling price remains unchanged?

d. If Air Peanut's direct labor costs increase by \(5 \%\), what selling price per 100 packets must it charge to maintain the same contribution margin to sales ratio?

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Estimated annual sales volume = 11,535,700 packets Selling price $35.00 Variable costs: Raw materials $16.00 Direct labor 7.00 Manufacturing support 4.00 Selling expenses 1.60 Total variable costs per 100 packets $28.60 Annual fixed costs: Manufacturing support $192,000 Selling and administrative 276,000 Total fixed costs $468,000