2. The Smart Company is located in Toronto, Ontario. The company produces flash drives for...
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2. The Smart Company is located in Toronto, Ontario. The company produces flash drives for computers, which it sells for $20 each. Each flash drive incurs $6 of variable costs during production. In April, 1,000 drives were sold. Fixed costs for April were $2 per unit for a total of $2,000 for the month. Calculate the contribution margin per unit and the contribution margin ratio. Explain the difference between contribution margin and gross margin. 3. The Smart Company produces flash drives for computers, which it sells for $20 each. The variable cost to make each flash drive is $6. During April, 700 drives were sold. Fixed costs for April were $2 per unit for a total of $1,400 for the month. Calculate the monthly break-even level of sales in dollars and in units. How would the break-even be impacted if the selling price increased by 10% with everything else remaining the same
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