Lyndia Company is a merchandiser that sells a total of $15$ products to its customers. The company provided the following

information from last year:

Last year, Lyndia's total fixed expenses and net operating income were $$3,000,000$ and $$1,223,070,$ respectively. The

company would like your assistance in developing some financial projections for this year.

Click here for a brief tutorial on Goal Seek in Excel.

Navigate to the "Requirement $3"$ tab of the Excel workbook to complete requirements $3$ a$.$ through $3$ c $.$ Assume the sales mix

percentages $($as shown in rows $3$ and $21)$ hold constant.

a$.$ Using Goal Seek, calculate the total unit sales required to break even. $($Hint: Instruct Goal Seek to obtain a net operating income

of $$0,$ as shown in cell Q$31,$ by changing the unit sales in cell Q$14.)$

b$.$ What are the dollar sales required to break even?

c$.$ What was the company's margin of safety last year?

Navigate to the "Requirement $4"$ tab of the Excel workbook to complete requirements $4$ a $.$ through $4$ d $.$ Assume the sales mix holds

constant and the company plans to increase the selling prices of all products by $5\%.($Hint: Focus on cell Q$16$ to input this

projection.$)$

a$.$ Using Goal Seek, calculate the total unit sales required to break even. Is your answer greater than, less than, or equal to the

answer you obtained in requirement $3$a$?$

b$.$ How is the amount in cell B$23$ calculated?

c$.$ Why does the contribution margin ratio shown in cell R$29$ differ from the corresponding percentage from last year, as shown in

cell R$9?$

d$.$ Should the company increase its selling prices by $5\%$ this year?

Why does the contribution margin ratio shown in cell R$29$ differ from the corresponding percentage from last year, as shown

in cell R$9?$

Because each product's selling price is being increased by $5\%$ while holding its variable expense per unit

constant.

Because each product's selling price is being increased by $5\%$ while decreasing its variable expense per unit

by $5\%.$