29. CVP Sensitivity Analysis (Multiple Products). Gonzalez Company produces two different products that have the following monthly data (this is the base case). Cruiser Racer Total Selling price per unit $300 $1,200 Variable cost per unit $120 $ 720 Expected unit sales 1,400 600 2,000 Sales mix 70 percent 30 percent 100 percent Fixed c0515 $180,000 Required: For each of the independent situations in requirements 2 through 4, assume that total sales remains at 2,000 units. 1. Prepare a contribution margin income statement. 2. Refer to the base case. What would the operating prot be if the Cruiser sales price {1) increases 20 percent, or (2) decreases 20 percent? 3. Refer to the base case. What would the operating prot be if the Cruiser sales volume increases 400 units with a corresponding decrease of 400 units in Racer sales? 4. Refer to the base case. What would the operating prot be if total xed costs increase ve percent? Does this increase in xed costs result in higher operating leverage or lower operating leverage? Explain. 30. Contribution Margin with Resource Constraints. O/ciePath Company produces two different products that have the foilowing price and cost characteristics. Bicycle Tricycle Selling price per unit $200 $100 Variable cost per unit $120 $ 50 Management believes that pushing sales of the Bicycle product would maximize company prots because of the high contribution margin per unit for this product. However, only 50,000 labor hours are available each year, and the Bicycle product requires 4 labor hours per unit whiie the Tricycle model requires 2 labor hours per unit. The company sells everything it produces. Required: 1. Calculate the contribution margin per unit of constrained resource for each model. 2. Which model would CycIePath prefer to sell to maximize overall company prot? Explain