Part Two Contribution Margin

James and Jackie Simpson set up a company called Heavenly Sounds Incorporated. They provide music CDs around the Virginia Beach, Virginia area for various musical artist and aspiring musical artists. The company sold $12,000$ CDs and they sell for $$18$ each for the year ended December $31.$ The tax rate is $21\%.$

Variable production costs

Plastic for casing $-$ $$1,500$

Wage of assembly workers $-$ $$30,000$

Labeling $-$ $$3,000$

Selling and Administrative$-$$$6,000$

Fixed manufacturing costs

Rent on Factory $-$ $$6,750$

Factory maintenance $-$ $$4,520$

Factory machine depreciation $-$ $$20,000$

Fixed selling and administrative costs

Lease of equipment $-$ $$1,050$

Accounting staff salaries $-$ $$15,000$

Administrative management salaries $-$ $$120,000$

Required: Please complete the following:

$1.$ Compute the contribution margin.

$2.$ Compute the contribution margin ratio.

$3.$ Compute the break$-$even in sales units.

$4.$ Compute the break$-$even in sales dollars.

$5.$ Compute the margin of safety in units.

$6.$ Prepare a contribution income statement for the year end.

$7.$ Compute the unit sales required for a monthly after$-$tax profit of $$50,000.$