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Sunshine Inc,. Sells a single product. The company's most recent income statement is given below. Sales (4, 000 units) $120, 000 Less variable expenses (68,
Sunshine Inc,. Sells a single product. The company's most recent income statement is given below. Sales (4, 000 units) $120, 000 Less variable expenses (68, 000) Contibution margin 52, 000 Less fixed expenses (40, 000) Net income $12, 000 Required: A. Calculate the contribution margin per unit. 2 marks B. Calculate the total variable cost if sales are doubled to $240, 000 2 marks C. What will total fixed costs equal if sales are doubled to $240? 2 marks D. If Sunshine is past the breakeven point and 10 more units are sold, how much will profits increase by? 4 marks E. Compute how many units must be sold to breakeven. 4 marks F. Compute how many units must be sold to achieve a profit of $20, 000 4 marks G. Define the term CVP analysis 2 marks H. List and explain 2 assumptions of CVP analysis 5 marks I. List and explain 2 limitations of CVP analysis 5 marks
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