Reference no: EM133101323
Question - The following is Addison Corporation's contribution format income statement for last month:
Sales $1,000,000
Variable expenses 700,000
Contribution margin 300,000
Fixed expenses 180,000
Net Operating income $120,000
The company has no beginning or ending inventories. A total of 20,000 units were produced and sold last month.
Required -
1. What is the company's contribution margin ratio?
2. What is the company's break-even in units?
3. How many units would the company have to sell to attain the target profit of $150,000?
4. What is the company's margin of safety in dollars?
5. What is the company's degree of operating leverage?