Do It! Review 19-1

Victoria Company reports the following operating results for the month of April.

VICTORIA COMPANY CVP Income Statement For the Month Ended April 30, 2017 Total Per Unit Sales (8,600 units) $395,600 $46 Variable costs 197,800 23.00 Contribution margin 197,800 $23.00 Fixed expenses 181,700 Net income $16,100

Management is considering the following course of action to increase net income: Reduce the selling price by 8%, with no changes to unit variable costs or fixed costs. Management is confident that this change will increase unit sales by 20%. Using the contribution margin technique, compute the break-even point in units and dollars and margin of safety in dollars: (Round intermediate calculations to 4 decimal places e.g. 0.2522 and final answer to 0 decimal places, e.g. 2,510.) (a) Assuming no changes to selling price or costs.

Break-even point units Break-even point $ Margin of safety $