Lindon Company is the exclusive distributor for an automotive product that sells for $48.00 per unit...

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Accounting

Lindon Company is the exclusive distributor for an automotiveproduct that sells for $48.00 per unit and has a CM ratio of 30%.The company’s fixed expenses are $324,000 per year. The companyplans to sell 26,500 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 $180,000 per year?
4. Assume that by using a more efficient shipper, the company isable to reduce its variable expenses by $4.80 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$180,000?

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4.1 Ratings (754 Votes)

1 Variable cost per unit Variable cost to sales ratio 100 30 a 70 Selling price per unit b 48 Variable cost per unit ab 3360 2 Breakeven point in unit sales Fixed cost a 324000 Contribution margin per unit 48 3360 b 1440 See Answer

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