1) Kim and Izzy founded ABC Plumbing Company after graduating from college. They wanted to be completitieve, so they set their rate for a house call at a modest $100. After paying the company's gas and other variable cost totaling $60, the women thought there would be enough profit. Because they were ready to live a little, they set their salaries at $100,000 EACH. There are no other fixed cost.

a) What is the contribution margin?

b) What is the contribution margin ratio?

c) How many house calls must they make to breakeven.

d) What is the breakeven in sales dollars?

e) If they desire a profit of $20,000, how many house calls would be required?