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Calculate bay area cycle per unit variable expense

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Reference no: EM132914114

Current operating income for Bay Area Cycles Co. is $50,000. Selling price per unit is $100, the contribution margin ratio is 25%, and fixed expense is $200,000.

Required:

Problem 1. Calculate Bay Area Cycle's per unit variable expense and contribution margin. How many units are currently being sold?

Problem 2. How many additional unit sales would be necessary to achieve operating income of $125,000?

Reference no: EM132914114

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