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: Per Unit $ 40 28 Sales Variable expenses Contribution margin Fixed expenses Net operating income Total $ 620,000 434,000 186,000 151,200 $ 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 $68,400? 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 $61,000 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. Req 1 Reg 2 Reg Req 3B Reg 4 Req 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 Req 1 Req 2 Req Req 3B Req 4 Req 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. Req 1 Reg 2 Req 3A Req 3B Reg 4 Reg 5 How many units would have to be sold each month to attain a target profit of $68,400? Units sales needed to attain target profit Reg 1 Reg 2 Reg Req 3B Reg 4 Verify your answer by preparing a contribution format income stat Menlo Company Contribution Income Statement Total Per Unit Complete this question by entering your answers in the tabs below. Req 1 Reg 2 Req Req 3B Req 4 Reg 5 What is the company's CM ratio? If the company can sell more units thereby increasing sa is no change in fixed expenses, by how much would you expect monthly net operating inc CM ratio Net operating income increases by