McDonald's Corporation sells meals with a selling price of $10 per unit. Fixed costs amount to $1 billion, and variable costs are $6 per unit.

Required:

• Calculate the break-even point in units and sales dollars.
• Determine the margin of safety in units and percentage.
• Analyze the impact of a 10% increase in fixed costs on the breakeven point.
• Calculate the contribution margin ratio.
• Determine the sales units required to achieve a target profit of $500 million.