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Question 2 (9 points): AIC is a, manufacturing company which manufactures one product, the product has a Variable cost ratio = 60%, and the following
Question 2 (9 points): AIC is a, manufacturing company which manufactures one product, the product has a Variable cost ratio = 60%, and the following table presents the Contribution margin income statement for the company. Per unit Total 600,000 $ 72 $ Sales Variable cost CONTRIBUTION MARGIN Fixed cost Net operating income 100,000 $ Solve the following: 1. Selling price per unit (1 point) 2. Contribution margin ratio (1 point) 3. Break-even point in units (2 points) 4. What is the margin of safety in $ ? (1 point) 2 5. Assume the company wants to achieve a profit level of 60,000 $, what is the amount of sales that they must reach to achieve this level of profit (2 points) 6. Assume the company's sales revenue decrease by 5 %, what the effect be on the Net operating income ? (2 points)
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