Question - Fiesta Corporation manufactures a single product. The selling price is $125 per unit, and variable costs amount to $81 per unit. The fixed costs are $28,500 per month.
(a) What is the contribution margin per unit?
(b) What is the contribution margin ratio?
(c) What is the monthly sales volume (in dollars) at the break-even point?
(d) How many units must be sold each month to earn a monthly operating income of $50,000?
(e) What is the monthly margin of safety (in dollars) if 1,500 units are sold each month?
(f) What will be the monthly operating income if 1,500 units are sold each month?