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A company produces gadgets with the following details: Selling price per unit: $25 Variable cost per unit: $15 Fixed costs: $50,000 Requirements: Calculate the break-even

A company produces gadgets with the following details:

  • Selling price per unit: $25
  • Variable cost per unit: $15
  • Fixed costs: $50,000

Requirements:

  1. Calculate the break-even point in units.
  2. Determine the break-even point in sales dollars.
  3. If the company wants to make a profit of $20,000, how many units must it sell?
  4. Calculate the margin of safety in units if the company sells 6,000 units.
  5. Determine the margin of safety percentage.

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