Outdoor Quests Ltd has estimated that budgeted production and sales of its backpacks for the year 2022 will be 8,000 units at a price of $120 per unit. Variable manufacturing costs are estimated to be $58 per unit, and variable marketing costs $14 per unit sold. Fixed costs are expected to be $180,000 for manufacturing and $72,000 for marketing. There will be no beginning or ending work in process inventory, or nished goods inventory.

Required:

Show ALL your workings.

i. Calculate the companys budgeted break-even point in units and sales dollars. (3 Marks)

ii. Calculate the companys margin of safety in units. (2 Marks)

iii. Calculate the number of units sold in order to earn a before-tax prot of $180,000 for 2022. (3 Marks)