True Blue produces a single product. The projected income statement for the coming year is as follows:

Sales (25,000 units @ $37)	$ 925,000
Total Variable Costs	$(350,000)
Contribution Margin	$ 575,000
Total Fixed Costs	$(125,000)
Profit	$ 450,000

Required:

Compute the break-even point in units and sales dollars.

[4 marks]

Compute the new operating profit if sales are 20 per cent higher than expected. (Note: round to the nearest dollar).

[4 marks]

If the variable cost became $18 per unit, what would the new break-even amount be in units? (Note: round to the nearest unit and dollar)

[4 marks]

Explain what is meant by a margin of safety and what would this margin be if True Blue sold 28,000 units per year? (Note: use your answer from Part c.)

[4 marks]

What does the term relevant range mean. Give an example to support your answer (maximum of 200 words).