Each Applicator is sold for $40.

The following information on the products total costs over the past five (5) months is provided below:

Month Units Total Costs ($)

1 1,250 38,000

2 1,750 41,750

3 2,350 55,080

4 2,100 48,100

5 3,000 59,000

Required:

a) Using the High-Low method, calculate:

i. The Applicator variable cost per unit.

ii. The products monthly fixed costs.

b) Based on your answer above, compute the products contribution margin per unit and contribution margin ratio.

c) If the company wants to earn a target income of $61,000 on this product, compute the level of sale dollars required.

d) If the company achieves this level of sales (from part c), compute Intunes margin of safety in dollars with respect to the Applicator 2000.