Product B Solar Panel Battery (SPB)

Data for the Income Statement (SPB)

The expected total sales for this product for the year end 30 June 2022 are $16,000,000 and the expected total costs and operating expenses are $10,400,000. The costs will be allocated as follows:

Table B-1

Cost/Expense item	Amount ($)
Cost of goods sold	4,700,000
Sales Salaries expense	750,000
Office Salaries expense	600,000
Advertising expense	850,000
Office supplies expense	528,000
Rent expense	980,000
Insurance expense	390,000
Utilities expense	490,000
Depreciation expense	282,000
Interest expense	380,000
Tax expense	450,000
Total	10,400,000

Cost-Volume-Profit (CVP)

This section relates to Table B-1. Each solar panel battery sells for $12,500 and the variable cost per battery is $4,922. Variable costs include sales salaries, advertising and cost of goods sold. All other costs are fixed costs and they totalled $4,100,000.

Determine:

1. the contribution margin (CM)
2. the break-even point (BEP)
3. the sales units required to achieve a profit $7,000,000

Where applicable, round your answers to the nearest whole number.