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Contribution Margin, Cost-Volume-Profit, Margin of Safety, Target Net Income Candyland Inc. produces a particularly rich praline fudge. Each 10-ounce box sells for $5.60. Variable unit costs are as follows: Pecans $0.70 Sugar $0.35 Butter $1.85 Other Ingredients $0.34 Box, packing materials $0.76 Selling Commission $0.20 Fixed overhead cost is $32,300 per year. Fixed selling and administrative costs are $12,500 per year. Candyland sold 35,000 boxes last year. Required: 1. What is the contribution margin per unit for a box of praline fudge? What is the contribution margin ratio? 2. How many boxes must be sold to break even? What is the break-even sales revenue? 3. What was Candyland's operating income last year? 4. What was the margin of safety? 5. If Candyland wants to earn $11,200, how many boxes do they need to sell? 6. Suppose that Candyland Inc. raises the price to $6.20 per box but anticipates a sales drop to 31,500 boxes. What will be the new break-even point in units? Should Candyland raise the price? Explain