Break-even analysis, what-if analysis Polar Parkas Company budgets sales rev¬ enues at $30 per unit, flexible costs at $19.50 per unit, and capacity-related costs at $147,000 for the year 2000.

REQUIRED

(a) What is Polar's contribution margin per unit?

(b) Determine the number of units Polar must sell to break even.

(c) Determine the sales revenue required to earn (pretax) income equal to 20% of revenue.

(d) Polar is considering increasing its advertising expenses by $38,500. How much of an increase in sales units is necessary from expanded advertising to justify this expenditure?

(LO 8)