Exercise 2 Event Company produces a single product with the following characteristics: price per unit, $30.00; variable material cost per unit, $9.20; variable labor cost per unit, $4.40; variable overhead cost per unit, $2.20; and fixed overhead cost per unit, $3.00. Event Company's manufacturing fixed costs are $5 million, and selling, general, and administration fixed costs are $1.5 million. What dollar sales are required for Event Company to earn a target profit of $600,000?

Exercises 3 The following information pertains to Torasic Companys budgeted income statement for the month of June: Sales (1,500 units at $300) $450,000 Variable cost 200,000 Contribution margin 250,000 Fixed cost 280,000 Net loss $(30,000) Required a) Determine the companys breakeven point in both units and dollars. b) The sales manager believes that a $25,000 increase in the monthly advertising expenses will result in a considerable increase in sales. How much of an increase in sales must result from increased advertising in order to break even on the additional monthly expenditure? c) The sales manager believes that an advertising expenditure increase of $25,000 coupled with a 12% reduction in the selling price will double the sales quantity. Determine the net income (or loss) if the company adopts these proposed changes.