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Data concerning Bunck Corporation's single product appear below Per Unit $170 Percent of Sales 100% 20% 80% Variable expenses 34 Contribution margin.. $136 Fixed expenses
Data concerning Bunck Corporation's single product appear below Per Unit $170 Percent of Sales 100% 20% 80% Variable expenses 34 Contribution margin.. $136 Fixed expenses are $202,000 per month. The company is currently selling 2,000 units per month. Management is considering using a new component that would increase the unit variable cost by $18. Since the new component would increase the features of the company's product, the marketing manager predicts that monthly sales would increase by 400 units. What should be the overall effe ct on the company's monthly net operating income of this change? Current scenario: Future scenario: %s 100% 20% 80% 1 unit 2,000 units 1 unit Sales Less: VC CM Less: FE NOI $170 $34 $136 Sales Less: VC CM Less: FE NOI 100% #DIV/0! #DIV/0! USE THE CURRENT SCENARIO TO ANSWER THE QUESTIONS BELOW: Evaluate the current scenario, what is the margin of safety in dollars? What is the margin of safety expressed as a percentage of sales? Please round your answer to 2 decimal places. Calculate unit sales to break-even (round up to the nearest whole unit) Assume our target profit is $100,000, what would our unit sales need to be to achieve that level of profit? (roundup) Calculate the break-even in sales dollars Assume our target profit is $100,000, what would our sales dollars need to be to achieve that level of profit
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