Exercise 6 (Break-even Analysis; Target Profit; Margin of Safety) Spuds Company sells a single product. The company's sales and expenses for a recent month follow: Total P600,000 Per Unit P40 28 P12 Sales... Less variable expenses.. 420,000 Contribution margin . Less fixed expenses.. Net operating income. 180,000 150,000 P 30,000 Required: 1. What is the monthly break-even point in units sold and in sales pesos? 2. Without resorting to computations, what is the total contribution margin at the break-even point? How many units would have to be sold each month to earn a minimum target profit of P18,000? Use the contribution margin method. Verify your answer by preparing a contribution income statement at the target level of sales 3. 4 efer to the original data. Compute the company's margin of safety in 5. What is the company's CM ratio? If monthly sales increase by P80,000 both peso and percentage terms. and there is no change in fixed expenses, by how much would you expect monthly net operating income to increase? Exercise 6 (Break-even Analysis; Target Profit; Margin of Safety) Spuds Company sells a single product. The company's sales and expenses for a recent month follow: Total P600,000 Per Unit P40 28 P12 Sales... Less variable expenses.. 420,000 Contribution margin . Less fixed expenses.. Net operating income. 180,000 150,000 P 30,000 Required: 1. What is the monthly break-even point in units sold and in sales pesos? 2. Without resorting to computations, what is the total contribution margin at the break-even point? How many units would have to be sold each month to earn a minimum target profit of P18,000? Use the contribution margin method. Verify your answer by preparing a contribution income statement at the target level of sales 3. 4 efer to the original data. Compute the company's margin of safety in 5. What is the company's CM ratio? If monthly sales increase by P80,000 both peso and percentage terms. and there is no change in fixed expenses, by how much would you expect monthly net operating income to increase