Please answer Questions 1- 5

We are closing the books on our first year in business. Below are our financial statements. Remember that we started the year with high costs, low production, and high customer prices. Throughout the year, we found some efficiencies such as purchasing in bulk and we also increased our fixed costs by opening a brick-and-mortar store front. When conducting your calculations, consider unit costs you calculated on the last tab. If there is a difference between unit costs on the last tab and the unit contribution margin on this tab, what could be the cause of the difference?
Contribution Margin Income Statement
Sales	$ 33,150.00			Units produced	1,950
Variable costs	$ 21,547.50			Unit cost
Contribution Margin	$ 11,602.50
Fixed costs	$ 8,500.00
Operating income	$ 3,102.50
1. Our prices have fluctuated this year. Calculate the unit contribution margin using averages. Show your work. Sales are based on the customer price from the EOS tab.
2. If we kept our original price (see Job Order tab) and adjusted our variable cost to $10.75, what would be our unit contribution margin?
3. Calculate the contribution margin ratio for both Option (1) and (2). Show your work.
Option 1
Option 2
4. Calculate the break-even in units for both Option (1) and (2). Show your work.
Option 1				Units
Option 2				Units
5. You found a local coffee shop that will carry your cupcakes. You have a verbal contract to deliver 6 dozen each week. Use the contribution margin ratio for Option 1 to calculate the change in operating income. Assume you deliver 6 dozen every week for 52 weeks. Show your work.