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Momento Camera Company is considering introducing a new video camera. Its selling price is projected...

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Accounting

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Momento Camera Company is considering introducing a new video camera. Its selling price is projected to be $1,300 per unit. Variable manufacturing costs are estimated to be $520 per unit. Variable selling costs are 10% of sales dollars. The company expects the annual fixed manufacturing costs for the new camera to be $3,503,500. Requirements (a) Compute Momento's contribution margin per unit and contribution margin ratio. (b) Determine the number of units Momento must sell to break even. (c) Momento is considering a design modification that would reduce the variable cost of the camera by $50 per unit. Explain whether this change will cause Momento's breakeven point to increase or decrease, compared to the initial plans

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