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Victoria Company reports the following operating results for the month of April. VICTORIA COMPANY CVP Income Statement For the Month Ended April 30, 2017 Total Per Unit Sales (9,200 units) $414,000 $45 Variable costs 223,560 24.30 Contribution margin 190,440 $20.70 Fixed expenses 161,460 Net income $28,980 Management is considering the following course of action to increase net income: Reduce the selling price by 7%, with no changes to unit variable costs or fixed costs. Management is confident that this change will increase unit sales by 10%. Using the contribution margin technique, compute the break-even point in units and dollars and margin of safety in dollars: (Round intermediate calculations to 4 decimal places e.g. 0.2522 and final answer to 0 decimal places, e.g. 2,510.) (a) Assuming no changes to selling price or costs. Break-even point units Break-even point $ Margin of safety $ (b1) Assuming changes to sales price and volume as described above. Break-even point units Break-even point $ Margin of safety $

Financial Accounting, Accounting

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