1. Greenfield Printers manufactures three computer printer models: Inkjet, Laser, and Impact. Total annual fixed costs are $4,900,000. Other information for the three printers is as follows:

	Inkjet	Laser	Impact
Selling price per unit	$250	$400	$1,600
Variable cost per unit	$100	$150	$ 800
Sales mix	60 percent	30 percent	10 percent

Assume that the sales mix does not change.

Required: Calculate:

i.How many units of each printer must be sold to break even? [6 marks]

ii.How many units of each printer must be sold to earn an annual profit of $1,112,300? [3.5 marks]

iii. How many units of each printer must be sold to achieve an after-tax profit of $73,500. The tax rate is 40%. [4.5 marks]

B. Management of Posh Automobile wants to know the margin of safety for a piece of equipment it is purchasing. They have established that the break-even revenue will be $3,957,188 while annual sales will be $4,200,000.

Required: Calculate:

i. Margin of safety in dollars ($) [2 marks]

ii. Margin of safety in percentage (%). [2 marks]