Response to the following problem:
Hudson Co. reports the contribution margin income statement for 2015. HUDSON CO.
Contribution Margin
Income Statement For Year Ended December 31, 2015
Sales (9,600 units at $225 each) $ 2,160,000
Variable costs (9,600 units at $180 each) 1,728,000
Contribution margin $ 432,000
Fixed costs 324,000
Pretax income $ 108,000
If the company raises its selling price to $240 per unit.
1. Compute Hudson Co.'s contribution margin per unit.
2. Compute Hudson Co.'s contribution margin ratio.
3. Compute Hudson Co.'s break-even point in units.
4. Compute Hudson Co.'s break-even point in sales dollars