CM per unit = Selling price - Variable cost per unit.
CM per unit = $ 220 - $ 57.20 = $ 162.80.
Q-1.
Units sold = 5000.
CM = 5000 * 162.80 = $ 814000.
Profit = CM - Fixed Cost.
Profit = $ 814000 - $ 713064 = $ 100936.
Q-2
Break even units = ( Fixed cost ) / CM per unit
Break even units = $ 713064 / $ 162.80 = 4380 units.
Q-3.
If company sells 4000 units, company will incurr loss. Because company selling below break even point.
Profit / ( loss ) = 4000 * 162.80 - 713064 = $ 61864.
Extra sales units = 40000 / 220 =
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