Use this income statement to answer the questions that follow.
|
Sales ($50 per unit) |
$5,000 |
|
|
Less: Cost of goods sold ($32 per unit) |
3,200 |
|
|
Gross margin |
1,800 |
|
|
Less operating expenses: |
||
|
Salaries |
$800 |
|
|
Advertising |
400 |
|
|
Shipping ($2 per unit) |
200 |
1,400 |
|
Operating Income |
$ 400 |
Required
- What is the variable cost per unit?
- What is the total fixed expense?
- What is the contribution margin per unit?
- What is the contribution margin ratio?
- What is the breakeven point in units? In dollars?
- What is the margin of safety in units? In dollars?