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Problem 1 - Blanchard Company manufactures a single product that sells for $150 per unit and whose total variable costs are $120 per unit. The company's annual fixed costs are $471,000.
Required -
(a) Compute the company's contribution margin per unit.
(b) Compute the company's contribution margin ratio.
(c) Compute the company's break-even point in units.
(d) Compute the company's break-even point in dollars of sales.
Problem 2 - A jeans maker is designing a new line of jeans called Slims. The jeans will sell for $355 per pair and cost $262.70 per pair in variable costs to make.
(1) Compute the contribution margin per pair.
(2) Compute the contribution margin ratio.
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