Q1. Omer Company Sales price $50 per unit

Production cost: direct materials $15, direct labor $7, variable over head $2 and production fixed costs $80,000 per month, operating expense were $40,000 fixed, $1 variable per unit. if Omer company produced 20,000 unit but 16,000 unit were sold.

Instructions:

1. Compute total production cost of 20,000 units

2. Compute the cost of goods sold

3. Compute the absorption net income

4. Compute the direct net income

5. Compute the break-even point in units.

6. Compute the sales level in units if margin of safety ratio 50%.

7. Compute the sales level in dollars make profit ratio 20%