Ace Corporation produced and sold 140,000 units of its only product during the year just ended at an average price of $15 per unit. Variable manufacturing costs were $6 per unit, and variable marketing costs were $3 per unit sold. Fixed costs amounted to $370,000 for manufacturing and $108,000 for marketing. There was no year-end work-in-process inventory.

Required: Show all calculations.

1. Compute Ace Corporations break-even point in sales units for the year just ended.

2. Compute the revenue that would have been required to earn an operating income of $270,000 during the year just ended.

3. Ace Corporations variable costs are expected to increase by 25 percent in the coming year. Compute the break-even point in sales units for the coming year.

4. If Ace Corporations variable manufacturing costs do in fact increase by 25 percent but the variable marketing costs remain the same (i.e., at $3 per unit), then compute the selling price that would yield the same contribution margin ratio in the coming year as was achieved in the current year just ended.