Chapter 16, Problem 20E

1.

To determine

Compute the contribution margin per unit and the contribution margin ratio.

2.

To determine

Compute the break-even in units and in sales revenue.

3.

To determine

Compute the operating income for previous year.

4.

To determine

Compute the margin of safety in sales revenue.

5.

To determine

Compute the new break-even point in units if the price increases, resulting in a decrease of sale and evaluate should the new price be accepted.