Lindon Company is the exclusive distributor for an automotive product that sells for $60 per unit and has a CM ratio of 35%. The companys fixed expenses are $226,800 per year. The company plans to sell 14,500 units this year. Required:

1. What are the variable expenses per unit?

2. Use the equation method: a. What is the break-even point in unit sales and in dollar sales? b. What amount of unit sales and dollar sales is required to earn an annual profit of $63,000? c. Assume that by using a more efficient shipper, the company is able to reduce its variable expenses by $3 per unit. What is the companys new break-even point in unit sales and in dollar sales? .

3. Repeat (2) above using the formula method. a. What is the break-even point in unit sales and in dollar sales? b. What amount of unit sales and dollar sales is required to earn an annual profit of $63,000? c. Assume that by using a more efficient shipper, the company is able to reduce its variable expenses by $3 per unit. What is the companys new break-even point in unit sales and in dollar sales?