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) Mondo Company distributes a single product. The company's sales and expenses for last month follow Per Total $20 14 $ Sales Variable Contribution margin expenses ut operating in 214,200 91.800 76,200 $ 15,600 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 $37.2007 3. 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 $64,000 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 Reg DA Req5 Req 38 Reg4 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 > Complete this question by entering your answers in the tabs below. Reg 1 Reg2 Req 3A Reg 38 Reg 4 Reg 5 without resorting to computations, what is the total contribution margin at the break even point? Total contribution margin Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3A Reg 38 Reg 4 Reqs How many units would have to be sold each month to attain a target profit of $37,2007 Units salos needed to attain target profit Verify your answer by preparing a contribution format income statement at the target sales Menlo Company Contribution Income Statement Total Per Unit Complete this question by entering your answers in the tabs below. ped Reg 1 bok Reg 2 Req 3A Regla Reg 38 Reg 5 int lences 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 (1.0.0.1234 should be entered as 12.34).) Dollars Percentage Margin of safety Complete this question by entering your answers in the tabs below. Reg 2 Reg 1 Req 3A Reg 38 Reg 4 Reqs What is the company's CM ratio? If the company can sell more units thereby increasing sales by $64,000 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
