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Exercise 5-18 Break-Even and Target Profit Analysis; Margin of Safety, CM Ratio [LO5-1, LO5-3, Los-5 LO5-6, LO5-7 Menlo Company distributes a single product. The company's

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Exercise 5-18 Break-Even and Target Profit Analysis; Margin of Safety, CM Ratio [LO5-1, LO5-3, Los-5 LO5-6, LO5-7 Menlo Company distributes a single product. The company's sales and expenses for last month follow Per Unit $604,000 $40 422,80028 181,200 $12 Total Sales Variable expenses Contribution margin Fixed expenses 147,680 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 $58.800? 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 sales increase by $79,000 per month and there is no change in fixed expenses, by how much would you expect monthly net operating income to increase? 1 of 7 Next

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