Question
Current Units sold 1 450 Sales price per unit $ 100 Variable cost per unit $ 50 Fixed costs $20 500) Calculate the current breakeven
Current Units sold 1 450 Sales price per unit $ 100 Variable cost per unit $ 50 Fixed costs $20 500) Calculate the current breakeven point in units and dollars. (3 marks) ANSWER a: b) Prepare a contribution margin income statement showing the company's profitability performance. (2 marks) ANSWER b: c) They have recently received the result of a market survey that indicates that they can increase the retail price of their product by 10% without losing customers or market share. The company can also source a cheaper raw material, decreasing the unit raw material cost by 8%. Demonstrate how these changes will benefit the company. (4 marks) ANSWER c: d) What is the margin of safety in dollars, assuming projected sales are based on the new retail price.
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