Leverage Faldo Company produces a single product. The projected income statement for the coming year, based on sales of 200,000 units, is as follows:                                                                                   Sales                            $2,000,000                         Less: Variable costs                             1,400,000                         Contribution margin                           $600,000                         Less: Fixed costs                                 450,000                         Operating income                               $150,000 Question:            How many units must be sold to earn a profit equal to 10 percent of sales?

A company has set its initial selling price at $28 per unit.  Its variable manufacturing costs are $10 per unit produced.  Its variable selling and administrative costs are $2 per unit sold.  The company’s fixed manufacturing costs are $300,000 per period and its fixed selling and administrative costs are $150,000 per period.  The company’s target profit is $200,000 per period.   What is the breakeven point in units?       What is the breakeven point in dollars? How many units must be sold to achieve the target profit? If the fixed costs increase by 20%, how many units must be sold to achieve the target profit?

More-Power Company has projected sales of 75,000 regular sanders and 30,000 mini-sanders for next year. The projected income statement is as follows:     Regular Sander   Mini-Sander   Total Sales   $3,000,000   $1,800,000   $4,800,000 Less: Variable expenses   1,800,000   900,000   2,700,000 Contribution margin   $1,200,000   $900,000   $2,100,000 Less: Direct fixed expenses   250,000   450,000   700,000 Product margin   $950,000   $450,000   $1,400,000 Less: Common fixed expenses           600,000 Operating income           $800,000 Required:   1. For each of the following possible sales mixes, calculate operating income:   Regular Sander Mini-Sander a. 75,000 37,500 b. 60,000 60,000 c. 30,000 90,000 d. 30,000 60,000   Operating Income a. $_________ b. $______ c. $________ d. $_________   2. Calculate the break-even units for each product for each of the preceding sales mixes. Round the number of break-even packages to two decimal…