The following is last month's income statement for ACME Incorporated:

Sales $800,000

Less: variable expenses 440,000

360,000

Less: fixed expenses 220,000

Operating income $140,000

The company has no beginning or ending inventories and produced and sold 20,000 units during the month.

Required: What is the company's contribution margin ratio and contribution margin per unit?

What is the company's breakeven in sales and in units?

The marketing manager believes that a monthly increase of $10,000 in advertising will result in 450 more units sold each month. Should you approve? Why?

If the tax rate is 30%, how many units must be sold to attain an after-tax profit of $182,000?

List two assumptions of CVP analysis.