Paul Cablesource has the following information regarding Cat 6 plenum cable Sales $156.00 per box Cost $99.00 per box Fixed Cost $186,500.00 per month Tax rate is 19 percent How many boxes of cable must they sell to breakeven? What is the contribution margin in dollars and %? How boxes must Cablesource sell to earn a monthly operating profit after taxes of $22,500?

4) Paul Cablesource makes 3 types of Cables....Cat3, Cat5 and Cat6. The Company is operating at 80 percent capacity. Paul is worried about the Cat 3 product line and is thinking of dropping the product. If the product line is dropped all sales and variable cost would be eliminated. 15 percent of total fixed cost would be saved. CAT5 CAT3 CAT6 Sales $56,000 $90,567 $103,000 VC $38,000 $78,900 $85,000 CM $18,000 $11,667 $18,000 Fixed cost alloc $8,000 $15,000 $15,500 OP Prof(loss) $10,000 -$3,333 $2,500 Prepare a differential analysis like exhibit 4.8 on page 133 what you advise Paul to do.