1) Supernova Products distributes a single product whose selling price is $8 and whose variable cost is $6 per unit. The companys monthly fixed expense is $5,500.

a. Solve for the companys break-even point in units using the formula method.

b. Solve for the companys break-even point in sales dollars using the formula method.

2) Paradise Corporation has a single product whose selling price is $140 and whose variable expense is $60 per unit. The companys monthly fixed expense is $40,000.

a. Using the formula method, solve for the unit sales that are required to earn a target profit of $8,000.

b. Using the formula method, solve for the dollar sales that are required to earn a target profit of $8,000.

3) Creekside Corporation data is as follows: Selling price is $75 per unit; Variable expenses are $45 per unit (60% of sales), andcontribution margin is $30 per unit (40% of sales). Fixed expenses are $75,000 per month and the company is selling 3,000 units per month.

a. The marketing manager believes that an $8,000 increase in the monthly advertising budget would increase monthly sales by $15,000. Should the advertising budget be increased?