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Cranberry Wood Products Inc. spends an average of $9.50 in labor and $12.40 in materials on every unit it sells. Sales commissions and shipping amount

Cranberry Wood Products Inc. spends an average of $9.50 in labor and $12.40 in materials on every unit it sells. Sales commissions and shipping amount to another $3.10. All other costs are fixed and add up to $143,000 per month. The average unit sells for $32.00.

  1. Calculate the DOL when sales are 20%, 30% and 40% above breakeven. Do not round intermediate calculations. Round the answers to two decimal places.
    DOL
    20%
    30%
    40%
  2. Suppose automated equipment is added which increases fixed costs by $20,000 per month. How much will variable cost per unit have to decrease to keep the breakeven point the same? Round the answer to the nearest cent. $ per unit
  3. Calculate the new DOL when sales are 20%, 30% and 40% above breakeven. Do not round intermediate calculations. Round the answers to two decimal places.
    DOL
    20%
    30%
    40%

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