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Sonic-Red Amplification developed a new speaker model that management believes can be sold for $525 per unit. Variable costs are $300 per speaker and total fixed costs are $80,000.
Required:
Question a) Compute the company's break-even point in unit sales using the contribution margin method.
Question b) Compute the company's break-even point in sales dollars.
Question c) Determine how many units Sonic-Red must sell to earn a profit of $100,000 using the equation method (CVP Equation).
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