1. The Adept Co. is analyzing a proposed project. The company expects to sell 3,500 units, give or take 10 percent. The expected variable cost per unit is $7 and the expected fixed costs are $12,500. Cost estimates are considered accurate within a plus or minus 5 percent range. The depreciation expense is $6,000. The sale price is estimated at $15 a unit, give or take 2 percent. The company bases their sensitivity analysis on the expected case scenario. Answer Questions 2-4

2. What is the contribution margin under the expected case scenario?

   	a.	$8.72
   	b.	$8.65
   	c.	$8.00
   	d.	$3.00
   	e.	$2.67

3. What is the amount of the fixed cost per unit under the pessimistic case scenario?

   	a.	$4.00
   	b.	$3.55
   	c.	$5.02
   	d.	$4.17
   	e.	$5.55

4. The company is conducting a sensitivity analysis on the sales price using a sales price estimate of $18. Using this value, the earnings before interest and taxes will be:

   	a.	$18,500
   	b.	$14,000
   	c.	$16,000
   	d.	$20,000
   	e.	$28,500