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Pringle Company distributes a single product. The companys sales and expenses for a recent month follow:
1. What is the monthly break-even point in units sold and in sales dollars?
2. Without resorting to computations, what is the total contribution margin at the break-even point?
Total contribution margin $
3. How many units would have to be sold each month to earn a target profit of $30,000? Use the formula method.
Units sold
4. Refer to the original data. Compute the company's margin of safety in both dollar and percentage terms.(Round your percentage answer to 2 decimal places.)
5. What is the companys CM ratio? If monthly sales increase by $79,000 and there is no change in fixed expenses, by how much would you expect monthly net operating income to increase?
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