Menlo Company distributes a single product. The companys sales and expenses for last month follow:

Total

Per Unit

Sales

$

616,000

$

40

Variable expenses

431,200

28

Contribution margin

184,800

$

12

Fixed expenses

148,800

3.

a) How many units would have to be sold each month to earn a target profit of $63,600? Use the formula method.

Units sold:

b) Verify your answer by preparing a contribution format income statement at the target sales level.

Menlo Company
Contribution Income Statement
	Total	Per unit
	0	$0
	$0

Net operating income

$

36,000