Question
please answer A, B, and C

Tanner Companys most recent contribution margin income statement is presented below: Sales Variable expenses Contribution ma
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Answer #1

Answer a

Break even Point (in units) = Fixed Cost / Contribution per unit
=36000 / $ 6
= 6,000 units

Calculations:

Contribution per unit = selling price – variable cost per unit
= $ 15 -$ 9
= $ 6

Answer b

Desired sales = (Fixed Cost + Profit)/ Contribution per unit
=(36000+,000) / $ 6
= 7,500 units

Answer c

The Loss would reduce by $ 3,000.

Calculations:

Income statement
Present Proposed
Sales $ 75,000 $ 97,500
Less: variable Cost $ 45,000 $ 58,500
Contribution $ 30,000 $ 39,000
Less: Fixed Cost $ 36,000 $ 42,000
Net Income $ (6,000) $ (3,000)

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