Pringle Company distributes a single product. The company's sales and expenses for a recent month follow:

Total Per Unit

sales $600,000 $50

Variable expenses $456,000 $38

Contribution margin $144,000 $12

Fixed expenses $100,000

Net Operating income $44,000

1. What is the break even point in units sold and in sales dollars?

2. Without resorting to computations, what is the total contribution margin at the break-even point?

3. How many units would have to be sold each month to earn a target profit of $21,000?

4. Refer to original date. Compute the company's margin of safety in both dollars and percentages.

5. What is the company's CM ration? If monthly sales increases by $60,000 and there is no change in fixed expenses, by how much would you expect monthly net operating income to increase?