Sales Director, Britney Lipa is excited to share with you the most recent accounting numbers for"Stronger" Inc's sales and cost for producing their new line of popular high-fidelity systems for celebrity private jets:

December (2021)

Total sales of high fidelity systems $43,560

Less:

Purchase price paid -17,000

Additional labour and supplies-1,400

Commissions-1,250

Contribution margin 23,910

Less:

Fixed warehouse cost-680

Fixed administrative cost-4,300

Fixed selling cost-5,600

Research and Development-9750

Operating Income$3580

December (2020)

Total sales of high fidelity systems $41,700

Less:

Purchase price paid -16,000

Additional labour and supplies-1,200

Commissions-1,100

Contribution margin23,400

Less:

Fixed warehouse cost-500

Fixed administrative cost-4,300

Fixed selling cost-5,000

Research and Development-4,000

Operating Income$9,600

SOLVE and ANALYZE:

1a) Britney would like you to calculate the contribution margin ratio for both December for 2021 and 2020 and the 1b) BEP in sales dollars and margin of safety for years./15 marks

2) Share with Britney Lipa what you found in analyzing the differences between Dec 2021 and 2020 based on your calculations and give her some managerial accounting recommendations on how to make her company even stronger in the next 1-5 years. /10 marks