3. Urbana Company had sales of $400,000, variable costs of $240,000, and fixed costs of $90,000. In order to break-even necessary sales would be: A. $240,000 B. $225,000 C. $70,000 D. $250,000 Kyle's Donut Shop has been the only donut shop in town. However, after Barry's Breakfast Treats opened up last month, Kyle's sales have dropped. Kyle decides to cut the selling price of his delicious donuts. The decrease in selling price will result in: A. A reduction in the unit contribution margin. B. An increase in the unit contribution margin. C. A reduction in the unit variable costs. D. An increase in the unit variable costs. E. A reduction in fixed costs. 4. 5. In the month of December, the Valhalla Company produced 28,000 units and sold 30,000 units. Under absorption costing: A. Fixed manufacturing costs will be "released" from inventory and therefore net operating income will be lower than it would under variable costing operating income will be lower than it would under variable costing statement and therefore net operating income will be higher than it would under B. Fixed selling & administrative costs will be "released" from inventory and therefore net C. Fixed manufacturing costs will be included in inventory instead of on the income costing D. All fixed costs will be "released" from inventory and therefore net operating income will be lower than it would under variable costing