ABC Corporation has fixed expenses of $230,000. Each product they sell sells for $17. (10 marks)...

ABC Corporation has fixed expenses of $230,000. Each product they sell sells for $17.

a) Assuming variable costs are $12 use the income statement equation approach to find the break-even sales in units.

b) Assuming variable costs are $14 use the contribution margin shortcut approach to find the # of units ABC Corporation needs to sell to obtain an operating profit of $75,000.

c) Assuming a contribution margin % of 37.5% compute ABC Corporations operating profit if they sell 32,500 units.

d) Assuming a contribution margin of 55% use contribution margin ratio shortcut to calculate the break-even point in dollars.

e) Assuming they ABC corporation has a margin of safety of $250,000 with 35,000 units sold, what are variable costs per unit?

Expert Solution

ekkarill92 answered 2 years ago

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