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Week 3 Analysis of Cost, Volume, and Pricing to Increase Profitability ASSIGNMENT Building upon information from your work last week, provide the following calculations and analyses using MS Excel or a similar spreadsheet program. Here are the assumptions: Sales price per unit =$14.31 per unit Total Fixed costs =1,052,800 Variable cost per unit =$8.33 per unit Determine the following, showing both the formulas and calculations 1. Contribution margin per unit 2. Break-even point in units 3. Sales volume needed to reach a profit of $750,000 4. Now, apply the following INDEPENDENT changes and determine the impact on profitability (using sales units you calculated in 3 above) Increase in sales price by 5% - Decrease in variable cost to $7.45 per unit - Change in fixed costs to 900,000 5. Create a Cost-Volume-Profit Graph for your last scenario above (fixed costs =$900,000 ) Be certain to include fixed, variable, break-even point and sales volume and translate your results. 6. If in this scenario where fixed costs =$900,000, your budgeted sales are 230K units, calculate your margin of safety? 7. Finally, prepare a sensitivity analysis, like the one shown in Exhibit 3.3 for our company, using the following what-if scenarios, to calculate profitability (as in the Exhibit, incorporate these into one worksheet) Fixed costs in the range of $800K1.3M, in increments of 100K Variable costs in the range of $710 cost per unit, in $.50 increments Sales volume in units in the range of 150K500K units in increments of 50K units

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