Q1) Pennell Company gathered the following information for the year ended December 31, 2014:

Fixed costs:
Manufacturing	$300,000
Marketing	100,000
Administrative	50,000
Variable costs:
Manufacturing	$230,000
Marketing	90,000
Administrative	100,000

During the year, Pennell produced and sold 70,000 units of product at a sale price of $15.00 per unit. There was no beginning inventory of product on January 1, 2014.

Required:

1. Prepare Contribution Margin Income Statement.
2. Compute BEP (in units and TL)
3. Compute Operating Leverage
4. Compute Safety Margin (in units)
5. Compute the amount that must be sold to increase operating income (net incom 70 %.
6. Marketing manager believes there will be 10 % increase in sales if Company decreases price by 10 %. Should price is decreased?
7. If Company decreases price by 10%, how many units must be sold to maintain current profit?

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Q2)Print House, Inc., produces and sells laser jet printers for $1,400 each. The variable costs of each printer total $1,000 while total annual fixed costs are $300,000. Companys profit for 2008 is $200,000.

Required:

a) Compute the Companys break-even point in units and dollars.

b) What is the Companys margin of safety in units, dollars, and percentage?

c) Compute the Companys Sales for 2008.