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Number #3 Part A LOLA Corp. is undergoing an analysis of one of the products it produces, the Applicator 2000. Each Applicator 2000 is sold
Number #3 Part A LOLA Corp. is undergoing an analysis of one of the products it produces, the Applicator 2000. Each Applicator 2000 is sold for $40. The following information on the product's total costs over the past five (5) months is provided below: Month 1 2 3 4 5 Units 1.250 1.750 2.350 2,100 3,000 Total Costs ($) 38,000 41.750 55,080 48,100 59,000 Required: a. Using the High-Low method, calculate: i. The Applicator 2000's variable cost per unit. ii. The product's monthly fixed costs. b. based on your answer above, compute the product's contribution margin per unit and contribution margin ratio. c. If the company wants to earn a target income of $61,000 on this product, compute the level of sale dollars required. d. If the company achieves this level of sales (from part c), compute Intune's margin of safety in dollars with respect to the Applicator 2000
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