Red Company prepared the following budget information for the coming year: Bike A...
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Red Company prepared the following budget information for the coming year: Bike A $45,000 25.000 Bike B $1,200,000 800.000 Bike C $120,000 80.000 Total $1,365,000 905,000 $20,000 $400,000 Sales Variable expenses Contribution margin Fixed expense Operating income $40,000 $460,000 280.000 $180,000 The budget assumes the sale of 40,000 units of Bike A, 90,000 units of Bike B, and 70,000 units of Bike C. INSTRUCTIONS: a) What is the company's break-even point in sales dollars given the sales mis above? (5 points) b) What is the company's break-even point in units given the sales mis above? (8 points) c) How many units of each type of bike will be sold at the break-even point? (4 points) d) What is the company's margin of safety in dollars? (3 points)
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