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Waterways markets a simple water control and timer that it mass produces. During 2013, the company sold 696,000 units at an average selling price of per solution $4.20 per unit. The variable expenses were $1,900,080, and the fixed expenses were $683,256.
1)What is the product's contribution margin ratio? (Round to the nearest whole percentage)
2) What is the company's break even point in units and dollars for this product?
3) What is the company's margin of safety both in dollars and as a ratio? (Round to the nearest whole percentage)
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?
5)If sales increase by 51,000 units and the cost behaviors do not change, how much will income increase on this product?
1)What is the product's contribution margin ratio? (Round to the nearest whole percentage)
2) What is the company's break even point in units and dollars for this product?
3) What is the company's margin of safety both in dollars and as a ratio? (Round to the nearest whole percentage)
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?
5)If sales increase by 51,000 units and the cost behaviors do not change, how much will income increase on this product?
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