Ambrose, Inc is preparing a flexible budget for next year and requires a breakdownof the factory overhead cost into the fixed and variable elements.The following data on the OH cost and direct labor hours worked are available for the last 6 months of this year:

Month

OH Cost

Direct Labor Hours

January

$13,160

3,000

February

$10,440

2,050

March

$14,640

3,450

April

$13,240

3,100

May

$12,100

2,670

June

$11,240

2,350

Total

$74,820

16,620

1. Assume that Ambrose uses the high-low method of analysis, determine the variable OH cost per direct labor hour and monthly fixed cost

Additional Sales & Cost information forAmbrose's

Sales Price

$71.00

Direct Labor hours per unit

2

Direct labor cost per hour

$20.00

Direct Material cost per unit

$18.50

2. How many units do they need to sell to breakeven

3. How many units do they need to sell to earn a pre-tax profit of $4,713 in one month

4. Generate a contribution margin income statement for the pre-tax profit of $4,713