Jingle Bells Studio produced a hit for this years Christmas. The cost information is listed below:

CD package and disc (direct material and labor) $1.25/CD

Songwriters royalties $ 0.35/CD

Recording artists royalties $1.00/CD

Advertising and promotion $275,000

Studio Recordings, Inc.s overhead $250,000

Selling Price per CD $9.00

Calculate the following:

1. Contribution (also referred to as margin) in $ value and as a percentage
2. Breakeven in volume
3. Net profit if 1 million CDs are sold?
4. Necessary CD unit volume to achieve a $200,000 profit.