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Problem 7.34 Basic CVP Relationships; Retailer (LO 7.1, 7.2, 7.4) Disk City, inc is a retailer for digital video disks. The projected net income for

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Problem 7.34 Basic CVP Relationships; Retailer (LO 7.1, 7.2, 7.4) Disk City, inc is a retailer for digital video disks. The projected net income for the current year is $2,000,000 based on a sales volume of 280,000 video disks. Disk City has been selling the disis for $23 each. The variable costs consist of the $12 unit purchase price of the disks and a handing cost of $2 per disk. Disk Criy's annual fixed costs are $520000. Management is planning for the coming year, when it expects that the unit purchase price of the video disks will increase 30 percent (lgnore income taxes) Required: 1. Calculate Disk City's break-even point for the current yed in number of video disks. (Round your final answer up to nearest whole number.) 2. What will be the companys net income for the current year if there is a 15 petcent incresse in projected unit sales volume? 3. What volume of sales (in dollars) must Disk City achieve in the coming year to maintain the same net income as projected for the current year if the unit selling price remains at \$23? (Do not round intermediate colculations. Round your final onswer to the nearest whole number.) 4. In order to cover a 30 percent increase in the disk's purchase price for the coming year and stil maintain the current contributionmargin ratio, what selling price per disk must Disk City establish for the coming year? (Do not round intermediote calculations, Round your final answer to 2 decimal places.)

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