Problem 4A Estimating costs and Profits Swan Corporation manufactures ballet shoes. For the coming year, the company has budgeted the following costs for the production and sale of 50,000 pairs of shoes. 100% Percentage Budgeted of Costs Budgeted Costs Considered Costs per Pair Variable Direct materials $ 750,000 $15 Direct labor 250,000 5 100 Manufacturing overhead (fixed and variable) 600,000 12 Selling and administrative expenses 25 Totals $2,100,000 $42 30 500,000 10 Instructions a. Compute the sales price per unit that would result in a budgeted operating income of $800,000 assuming that the company produces and sells 50,000 pairs. (Hint: First compute the budgeted sales revenue needed to produce this operating income.) b. Assuming that the company decides to sell the shoes at a unit price of $100 per pair, compute the following: 1. Total fixed costs budgeted for the year. 2. Variable costs per unit. 3. The unit contribution margin. 4. The number of pairs that must be produced and sold annually to break even at a sales price of $100 per pair