#1 A ballpoint pen manufacturer had the following information:

Plastic tubes: top and tip .12 per unit

Ink .02 per unit

Direct Labor .02 per unit

Selling Price .40 per unit

Advertising $80,000

Managerial and secretarial salaries $200,000

Salespeople's commissions Factory 10 per cent of selling price

Factory overhead $120,000

Total available ballpoint pen market is 10 million pens (near this selling price).

Calculate:

a. unit contribution

b. break-even volume in units

c. share of total market to break even

d. total profit for the company if three million pens are sold

e. volume in units required to generate $500,000 profit.

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#2 Using the following information, calculate unit contribution:

a. Advertising = $50,000

b. Break-Even Sales Revenue = $450,000

c. Salaries = $40,000

d. Selling Price = $3 per unit

e. Overhead = $60,000