Units Sold to Break Even, Unit Variable Cost, Unit Manufacturing Cost, Units to Earn Target Income

Werner Company produces and sells disposable foil baking pans to retailers for $2.65 per pan. The variable cost per pan is as follows:

Direct materials	$0.28
Direct labor	0.53
Variable factory overhead	0.67
Variable selling expense	0.14

Fixed manufacturing cost totals $189,891 per year. Administrative cost (all fixed) totals $25,894.

Required:

1. Compute the number of pans that must be sold for Werner to break even. _____ pans

2. Conceptual Connection: What is the unit variable cost? What is the unit variable manufacturing cost? Round your answers to the nearest cent.

Unit variable cost	$_____
Unit variable manufacturing cost	$_____

Which is used in cost-volume-profit analysis?

Unit variable manufacturing costUnit variable cost

3. How many pans must be sold for Werner to earn operating income of $8,755? _____ pans

4. How much sales revenue must Werner have to earn operating income of $8,755? $______