1. Cost-Volume-Profit (CVP) Analysis

Data:

• Selling Price per Unit: $50
• Variable Cost per Unit: $30
• Fixed Costs: $100,000
• Expected Sales Volume: 10,000 units

Requirements:

1. Calculate Alpha Manufacturing's breakeven point in units and sales revenue.
2. Determine the contribution margin per unit and the contribution margin ratio.
3. Perform sensitivity analysis assuming a 20% increase in variable costs.
4. Discuss the implications of CVP analysis on pricing decisions for Alpha Manufacturing.
5. Evaluate the margin of safety for Alpha Manufacturing.
6. Recommend strategies to increase Alpha Manufacturing's breakeven point.