Accounting

Lindon Company is the exclusive distributor for an automotive product that sells for $40 per unit and has a CM ratio of 30%. The company’s fixed expenses are $180,000 per year. The company plans to sell 16,000 units this year.  Assume that by using a more efficient shipper, the company is able to reduce its variable expenses by $4 per unit.

What is the company’s new break-even point in unit sales and in dollar sales?

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What dollar sales is required to attain a target profit of $60,000?

 

Frontier Corp. has a contribution margin of $1,458,000 and profit of $364,500. If sales increase 18%, by how much will profits increase?

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