Gwazda Parkas Company's sales revenue is $33 per unit, variable costs are $23.10 per unit, and fixed costs are $137,610. Requirements (a) Compute Gwazda's contribution margin per unit and contribution margin ratio. (b) Determine the number of units Gwazda must sell to break even. (c) Determine the sales revenue required to earn (pretax) income equal to 10% of revenue. (d) How many units must Gwazda sell to generate an after-tax profit of $102,960 if the tax rate is 35%? (e) Gwazda is considering increasing its advertising expenses by $29,700. How much of an increase in sales units is necessary from expanded advertising to justify this expenditure (generate an incremental contribution margin of $29,700)?

Requirement (a) Compute

Gwazda's

contribution margin per unit and contribution margin ratio.Begin by determining the formula and computing the contribution margin per unit.

	-		=	Contribution margin per unit
	-		=

Part 2Now determine the formula and compute the contribution margin ratio. (Round the ratio to two decimal places.)

	/		=	Contribution margin ratio
	/		=

Part 3Requirement (b) Determine the number of units

Gwazda

must sell to break even.Determine the formula and compute the breakeven units.

	/		=	Breakeven units
	/		=

Part 4Requirement (c) Determine the sales revenue required to earn (pretax) income equal to

10%

of revenue.Begin by determining the formula used to determine how many units would be required to earn a (pretax) income equal to

10%

of revenue, then calculate the required units. (Round per unit amounts to the nearest cent and the required sales units up to the nearest whole number.)

	/ (		-		) =	Required unit sales
	/ (		-		) =

Part 5The sales revenue required to earn (pretax) income equal to

10%

of revenue is

$enter your response here.

Part 6Requirement (d) How many units must

Gwazda

sell to generate an after-tax profit of

$102,960

if the tax rate is 35%?Determine the formula used to determine how many units would be required to generate an after-tax profit of

$102,960

if the tax rate is 35%, then calculate the required units.

(		+		) /		=	Required unit sales
(		+		) /		=

Part 7Requirement (e)

Gwazda

is considering increasing its advertising expenses by

$29,700.

How much of an increase in sales units is necessary from expanded advertising to justify this expenditure (generate an incremental contribution margin of

$29,700)?

Begin by determining the basic formula used to compute the incremental profit.

-

=

Incremental profit

Part 8(Round the units up to the nearest whole number.)Sales units would need to increase by

enter your response here

units to justify the increase in advertising expenses.