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9) The "ABM" Company sells pencil cases for $10 each. Manufacturing cost is $2.60 per pencil case; marketing costs are $1.40 per pencil case; and royalty payments are 20% of the selling price. The fixed cost of preparing the pencil cases is $18 000. Capacity is 15 000 pencil cases. a) Compute the unit contribution margin and contribution rate. (2 marks) b) Compute the break-even point in units (2 marks) c) Determine the break-even point in units if fixed costs are increased by 20%. (2 marks) d) Determine the break-even point in units if the selling price is increased by 30%, while fixed costs are increased by 20%. (2 marks)

          9) The "ABM" Company sells pencil cases for $10 each. Manufacturing cost is $2.60 per pencil case; marketing costs are $1.40 per pencil case; and royalty payments are 20% of the selling price. The fixed cost of preparing the pencil cases is $18 000. Capacity is 15 000 pencil cases. a) Compute the unit contribution margin and contribution rate. (2 marks) b) Compute the break-even point in units (2 marks) c) Determine the break-even point in units if fixed costs are increased by 20%. (2 marks) d) Determine the break-even point in units if the selling price is increased by 30%, while fixed costs are increased by 20%. (2 marks)

9) The "ABM" Company sells pencil cases for 10 each. Manufacturing cost is2.60 per pencil case; marketing costs are 1.40 per pencil case; and royalty payments are 20% of the selling price. The fixed cost of preparing the pencil cases is $18 000. Capacity is 15 000 pencil cases. a) Compute the unit contribution margin and contribution rate. (2 marks) b) Compute the break-even point in units (2 marks) c) Determine the break-even point in units if fixed costs are increased by 20%. (2 marks) d) Determine the break-even point in units if the selling price is increased by 30%, while fixed costs are increased by 20%. (2 marks)

Added by William C.

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