Problem

Cinquante Company expects to sell 100,000 units of its product next year, which would gene...

Cinquante Company expects to sell 100,000 units of its product next year, which would generate total sales of $12 million. Management predicts that pretax net income for next year will be $3,000,000 and that the contribution margin per unit will be $40. Use this information to compute next year’s total expected (a) variable costs and (b) fixed costs.

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