Reference no: EM132675362

The Yucki Candy Co. makes and sells boxes of chocolate candy. Yucki has fixed expenses of $195,000 each month plus variable expenses of $6.00 per box of candy. Yucki sells each box of candy for $10.00.

Question 1: Compute the number of boxes of candy that Yucki must sell each month to break even. Round up to the nearest whole box.

Question 2: Compute the contribution margin ratio for a box of candy

Question 3: Compute the dollar amount of monthly sales Yucki needs to earn $2500,000 in profit. (Round the contribution margin ratio to four decimal places. Round sales up to the nearest dollar.)

Question 4: Prepare Yucki's contribution margin income statement for June for sales of 275,000 boxes of candy.

Question 5: What is the degree of leverage for June sales of 275,000 boxes of candy? (Carry answer out to four decimal places.)

Question 6: What is June's margin of safety (in dollars and cents)?

Question 7: By what percentage will operating income change if June's sales volume is 25% higher? (Round to two decimal places.)

Question 8: Prove your answer by comparing the difference in operating income after the change with the operating income before the change.