1.XYZ Corporation sells a single product for $40. Its management estimates the following revenues and costs for the year:

Net Sales $500,000

Selling expenses - variable 20,000

Direct Materials 150,000

Selling expenses - fixed 30,000

Direct Labour 90,000

Admin expenses - variable 10,000

MOH Variable 30,000

Admin expenses - fixed 20,000

MOH Fixed 40,000

(Manufacturing Overhead = MOH)

a.Assuming fixed costs and net sales are spread evenly throughout the year, calculate the monthly break-even point in units and in dollars.

b.Calculate the contribution margin ratio, the annual margin of safety ratio, and the annual profit.

c.Determine the sales required to earn an operating income of $360,000.