LittlePiggie

produces sports socks. The company has fixed expenses of

$80,000

and variable expenses of

$1.20

per package. Each package sells for

$2.50.

Requirements

1.	Compute the contribution margin per package and the contribution margin ratio.
2.	Find the break-even point in units and in dollars using the contribution margin shortcut approaches.
3.	Find the number of packages LittlePiggie needs to sell to earn a $25,000 operating income.

Question content area bottom

Part 1

Requirement 1. Compute the contribution margin per package and the contribution margin ratio.

Begin by identifying the formula that finds the contribution margin per package and then calculate the value. (Round your answers to the nearest cent.)

			=	Contribution margin per unit
			=