Lindon Company is the exclusive distributor for an automotiveproduct that sells for $32.00 per unit and has a CM ratio of 30%.The company’s fixed expenses are $177,600 per year. The companyplans to sell 20,900 units this year.
Required:
1. What are the variable expenses per unit? (Round your"per unit" answer to 2 decimal places.)
2. What is the break-even point in unit sales and in dollarsales?
3. What amount of unit sales and dollar sales is required toattain a target profit of $81,600 per year?
4. Assume that by using a more efficient shipper, the company isable to reduce its variable expenses by $3.20 per unit. What is thecompany’s new break-even point in unit sales and in dollar sales?What dollar sales is required to attain a target profit of$81,600?
