intermediate cost accounting

Cabrera Inc. produces and sells bobblehead dolls. Last year, Cabrera sold 156,250 units. The income statement for Cabrera Inc. for last year is as follows: Sales Less: Variable costs Contribution margin Less: Fixed costs Operating income $625,000 (343,750) $281,250 (180,000) $101.250 Required: 1. Compute the break-even point in units and in revenues. Compute the margin of safety in sales revenue for last year. 2. Suppose that the selling price decreases by 10 percent. Will the break-even point increase or decrease? Recompute the break-even point in units. (Round up to the next whole unit) 3. Suppose that the variable cost per unit decreases by $0.25. Will the break even point increase or decrease? Recompute the break-even point in units. (Round up to the next whole unit) 4. Can you predict whether the break-even point increases or decreases if both the selling price and the unit variable cost decrease? Recompute the break-even point in units incorporating both of the changes in Requirements 2 and 3. (Round up to the next whole unit) 5. Assume that total fixed costs increase by $50,000 (Assume no other changes from the original data). Will break-even point increase or decrease? Recompute it (Round up to next whole unit)