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My company sells small luxury good that is produced by the company. During 2019, the company sold 696,000 units at an average selling price of $4.20 per unit. The variable expenses were $1,900,080 and the fixed expenses were $683,256.
Question (1) What is the product's contribution margin ratio?
Question (2) What is the company's break-even point in units and in dollars for the product.
Question (3) What is the margin of safety, both in dollars and as a ratio?
Question (4) If management wanted to increase its income from this product by 10% , how many additional units would have to be sold to reach this income level.
Question (5) If sales increase by 48,000 units and the cost behaviors do not change,how much will net income increase on this product.
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