Exercise 5-18 (Algo) Break-Even and Target Profit Analysis; Margin of Safety; CM Ratio (LO5-1, LO5-3, LO5-5, LO5-6, LO5-7) Menlo Company distributes a single product. The company's sales and expenses for last month follow: Sales Variable expenses Contribution margin Fixed expenses Net operating income Total $ 620,000 434,000 186,000 151,200 $ 34,800 Per Unit $ 40 28 $ 12 Required: 1. What is the monthly break-even point in unit sales and in dollar sales? 2. Without resorting to computations, what is the total contribution margin at the break-even point? 3-a. How many units would have to be sold each month to attain a target profit of $74,400? 3-b. Verify your answer by preparing a contribution format income statement at the target sales level 4. Refer to the original data. Compute the company's margin of safety in both dollar and percentage terms. 5. What is the company's CM ratio? If the company can sell more units thereby increasing sales by $65,000 per month and there is no change in fixed expenses, by how much would you expect monthly net operating income to increase? Complete this question by entering your answers in the tabs below. 28 $ 12 Variable expenses Contribution margin Fixed expenses Net operating income 434,000 186,000 151,200 $ 34,800 Required: 1. What is the monthly break-even point in unit sales and in dollar sales? 2. Without resorting to computations, what is the total contribution margin at the break-even point? 3-a. How many units would have to be sold each month to attain a target profit of $74,400? 3-b. Verify your answer by preparing a contribution format income statement at the target sales level. 4. Refer to the original data. Compute the company's margin of safety in both dollar and percentage terms. 5. What is the company's CM ratio? If the company can sell more units thereby increasing sales by $65,000 per no change in fixed expenses, by how much would you expect monthly net operating income to increase? Complete this question by entering your answers in the tabs below. Req1 Reg 2 Req 3A Req 3B Req 4 Reg 5 What is the monthly break-even point in unit sales and in dollar sales? units Break-even point in unit sales Break-even point in dollar sales Reg 2 > Check my work 28 $12 Variable expenses Contribution margin Tixed expenses Net operating income 434,000 186,000 151,200 $ 34,800 48 Required: 1. What is the monthly break-even point in unit sales and in dollar sales? 2. Without resorting to computations, what is the total contribution margin at the break-even point? 3-a. How many units would have to be sold each month to attain a target profit of $74,400? 3-b. Verify your answer by preparing a contribution format income statement at the target sales level. 4. Refer to the original data. Compute the company's margin of safety in both dottor and percentage terms. 5. What is the company's CM ratio? if the company can sell more units thereby increasing sales by $65,000 per month and there is no change in fixed expenses, by how much would you expect monthly net operating income to increase? Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Rega Reg 38 Reg 4 Reg 5 without resorting to computations, what is the total contribution margin at the break-even point? Total contribution margin Check my work 29 Variable expenses Contribution margin Fixed expenses Net operating income UVVV 434,000 186.000 151,200 $ 34,800 $ 12 Required: 1. What is the monthly break-even point in unit sales and in dollar sales? 2. Without resorting to computations, what is the total contribution margin at the break-even point? 3-a. How many units would have to be sold each month to attain a target profit of $74,400? 3-b. Verify your answer by preparing a contribution format income statement at the target sales level. 4. Refer to the original data. Compute the company's margin of safety in both dollar and percentage terms. 5. What is the company's CM ratio of the company can sell more units thereby increasing sales by $65,000 per month and there is no change in fixed expenses, by how much would you expect monthly net operating income to increase? Complete this question by entering your answers in the tabs below. Req1 Reg 2 Reg 3A Reg 30 Reg 4 Reg 5 How many units would have to be sold each month to attain a target profit of $74,4007 Units salas needed to attain target profit Check my work 1. what is ue mon my break even pomti Unit Sdies and in contar Sales 2. Without resorting to computations, what is the total contribution margin at the break-even point? 3-a. How many units would have to be sold each month to attain a target profit of $74,400? 3-b. Verify your answer by preparing a contribution format income statement at the target sales level. 4. Refer to the original data. Compute the company's margin of safety in both dollar and percentage terms. 5. What is the company's CM ratio? If the company can sell more units thereby increasing sales by $65,000 per month and there is no change in fixed expenses, by how much would you expect monthly net operating income to increase? 2:03:14 Complete this question by entering your answers in the tabs below. OOK rences Req Reg 2 Reg 3A Reg 30 Reg4 Reg 5 Verify your answer by preparing a contribution format income statement at the target sales level Menlo Company Contribution Income Statement Total Per Unit 0$ 0 S 0 Check my work 1. Wat ne morny break-even point in uns dies and in una 2. Without resorting to computations, what is the total contribution margin at the break-even point? 3-a. How many units would have to be sold each month to attain a target profit of $74.400? 3-b. Verify your answer by preparing a contribution format income statement at the target sales level 4. Refer to the original data. Compute the company's margin of safety in both dollar and percentage terms 5. What is the company's CM ratio? If the company can sell more units thereby increasing sales by $65,000 per month and there is no change in fixed expenses, by how much would you expect monthly net operating income to increase? 2:59 Complete this question by entering your answers in the tabs below. Reg 1 Req2 Reg 3A Reg 38 Reg 4 Regs Refer to the original data. Compute the company's margin of safety in both dollar and percentage terms. (Round your percentage answer to 2 decimal places de 0.1234 should be entered as 12:34).) Dollars Percentage Margin of safety Check my work 1 $ 12 Contribution margin Tixed expenses Het operating income 186,000 151.200 $ 34,000 2:02:42 Required: 1. What is the monthly break even point in unit sales and in dollar sales? 2. Without resorting to computations, what is the total contribution margin at the break-even point? 3-a. How many units would have to be sold each month to attain a target profit of $74,400? 3-b. Verify your answer by preparing a contribution format income statement at the target sales level. 4. Refer to the original data. Compute the company's margin of safety in both dollar and percentage terms. 5. What is the company's CM ratio? If the company can sell more units thereby increasing sales by $65,000 per month and there is no change in fixed expenses, by how much would you expect monthly net operating income to increase? ON mint rices Complete this question by entering your answers in the tabs below. Reg Reg 2 Roq 3A Req 38 Reg4 Reg 5 What is the company's CM ratio? If the company can sell more units thereby increasing sales by $65,000 per month and there is no change in fixed expenses, by how much would you expect monthly net operating income to increase? CM ratio Net operating income increases by Reg4