Break$-$Even Units: Units for Target Profit

Jay$-$Zee Company makes an in$-$car navigation system. Next year, Jay$-$Zee plans to sell $19,000$ units at a price of $$400$ each. Product costs include:

Direct materials $$84\mathrm{.}00$

Direct labor $$48\mathrm{.}00$

Variable overhead $$12\mathrm{.}00$

Total fixed factory overhead $$733,000$

Variable selling expense is a commission of $6$ percent of price; fixed selling and administrative expenses total $$102,200.$

Required:

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$1.$ Calculate the sales commission per unit sold. If required, round your answers to the nearest dollar. Use rounded answers in subsequent computations.

$fill in the blank $00$a$575$f$2$e$016$f$96\_1$

$24$

per unit

Calculate the contribution margin per unit.

$fill in the blank $00$a$575$f$2$e$016$f$96\_2$

$232$

per unit

$2.$ How many units must Jay$-$Zee Company sell to break even? Round your answer to the nearest whole number.

fill in the blank $00$a$575$f$2$e$016$f$96\_3$

$3,600$

units

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Prepare an income statement for the calculated number of units. If an amount is zero, enter $"0".$ Do NOT round Break$-$even units and, if required, round your answer to the nearest dollar.

blank

Jay$-$Zee Company

Income Statement

Sales

$Sales

$1,260,000$

Less: Variable expenses

Less: Variable expenses

$604,800$

Contribution margin

$Contribution margin

$835,200$

Less: Fixed expenses

Less: Fixed expenses

Operating loss

$Operating loss

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$3.$ Calculate the number of units Jay$-$Zee Company must sell to achieve target operating income $($profit$)$ of $$420,384.$ Round your answer to the nearest whole number.

fill in the blank $905$a$67085$ff$8013\_1$

units

$4.$ What if the Jay$-$Zee Company wanted to achieve a target operating income of $$406,000?$ Would the number of units needed increase or decrease compared to your answer in Requirement $3?$ Round your answer to the nearest whole number.

Compute the number of units needed for the new target operating income.

fill in the blank $905$a$67085$ff$8013\_3$

units