Question One: Requirement A. Contribution Margin Ratio: Annual Revenue $4,000,000 Royalty Income: Sales of Oxacine 180,000x $120=$21,600,000 Royalty X20% Royalty Income $4 320,000 Total Projected Income $8,320,000 Less Variable Costs: Salaries $2,760,000 Lab Materials 765,000 $3,525,000 Contribution Margin $4,795,000 CMR 4,795,000/8,320,000 .5763 Requirement B. Revenue need to achieve Ol of $950,000 Fixed Expenses $54,270,000+01 $950,000=55, 220,000 Divided by CMR .5763 Revenue Needed $9,057,782 Requirement C Sales of Oxacing only 160,000 units next year what will Ol Be? Annual Revenue $4,000,000 Royalty Income 3,840,000 Total Income S7,840,000 Times CMR -5763 Contribution Margin $4,518,192 Less Fixed Expenses $4.270,000 OI $248,192 Question One: Requirement A. Contribution Margin Ratio: Annual Revenue $4,000,000 Royalty Income: Sales of Oxacine 180,000x $120=$21,600,000 Royalty X20% Royalty Income $4 320,000 Total Projected Income $8,320,000 Less Variable Costs: Salaries $2,760,000 Lab Materials 765,000 $3,525,000 Contribution Margin $4,795,000 CMR 4,795,000/8,320,000 .5763 Requirement B. Revenue need to achieve Ol of $950,000 Fixed Expenses $54,270,000+01 $950,000=55, 220,000 Divided by CMR .5763 Revenue Needed $9,057,782 Requirement C Sales of Oxacing only 160,000 units next year what will Ol Be? Annual Revenue $4,000,000 Royalty Income 3,840,000 Total Income S7,840,000 Times CMR -5763 Contribution Margin $4,518,192 Less Fixed Expenses $4.270,000 OI $248,192