1. XYZ Motors is a car dealership. On average it sells a car for $26,000, which it purchases from a manufacturer for $22,000. Each month, XYZ Motors pays $60,000 in rent and utilities and $70,000 for salespeople's salaries. In addition to their salaries, salespeople are paid a commission of $500 for each car they sell. XYZ Motors also spends $10,000 each month for local advertising. Its tax rate is 40% a. How many cars must XYZ sell each month to break even? b. XXZ Motors has target monthly after tax income of $63,000. What is its target operating income How many cars must be sold each month to achieve the target monthly after tax income of $63,000? c. 2. ABC Equipment sells riding lawn mowers. The average price for a lawn mower is $16,000. ABC purchases these mowers from the manufacturers at an average cost of $12,200. ABC's monthly fixed costs are $28,000 in rent, $45,000 in salaries, $5,600 in advertising and promotion, and $1,200 in other operating expenses. It has a corporate tax rate of 25%. a. How many mowers must ABC Equipment sell each month to break even? b. How many mowers must be sold each month if ABC Equipment has a target net income of $42,750 3. An electronic company had the following results for the year just ended: Revenue Cost of goods sols (48% of sales) Gross margin Operating costs: 800,000 384,000 416,000 Salaries fixed Sales commissions (12% of sales) Amortization of equipment fixtures Store rent (S5,100 per month) Other operating costs 212,000 96,000 19.200 61,200 72,300 460,700 S(44,700) Operating income (loss) The owner is unhappy with the operating results. An analysis of the other operating costs of $72,300 reveals that it includes $32,000 variable costs, for which the cost driver is sales volume, and $40,300 fixed costs. a. Prepare a contribution margin format income statement for the company b. Compute the contribution margin percentage for the company