ontribution Margin Ratio, Break-Even Sales Revenue, Sales Revenue for Target Profit Schylar Pharmaceuticals, Inc., plans to sell 135,000 units of antibiotic at an average price of $21 each in the coming year. Total variable costs equal $1,077,300. Total fixed costs equal $8,400,000. Required: 1. What is the contribution margin per unit? Round your answer to the nearest cent. $_____ What is the contribution margin ratio? Round your answer to two decimal places. (Express as a decimal-based answer rather than a whole percent amount.) ____ 2. Calculate the sales revenue needed to break even. Round your answer to the nearest dollar. $____ 3. Calculate the sales revenue needed to achieve a target profit of $295,000. Round your answer to the nearest dollar.

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Contribution Margin Ratio, Break-Even Sales Revenue, Sales Revenue for Target Profit

Schylar Pharmaceuticals, Inc., plans to sell 135,000 units of antibiotic at an average price of $21 each in the coming year. Total variable costs equal $1,077,300. Total fixed costs equal $8,400,000.

Required:

1. What is the contribution margin per unit? Round your answer to the nearest cent.
$_____

What is the contribution margin ratio? Round your answer to two decimal places. (Express as a decimal-based answer rather than a whole percent amount.)
____

2. Calculate the sales revenue needed to break even. Round your answer to the nearest dollar.
$____

3. Calculate the sales revenue needed to achieve a target profit of $295,000. Round your answer to the nearest dollar.
$_____

4. What if the average price per unit increased to $22.50? Recalculate the following:

a.  Contribution margin per unit. Round your answer to the nearest cent.
$_____

b.  Contribution margin ratio. Enter your answer as a decimal value (not a percentage), rounded to four decimal places.
_____

c.  Sales revenue needed to break even. In your computations, use your rounded answer from part (4-b) above for the contribution margin ratio, and round your final answer to the nearest dollar.
$_____

d.  Sales revenue needed to achieve a target profit of $295,000. In your computations, use your rounded answer from part (4-b) above for the contribution margin ratio, and round your final answer to the nearest dollar.
$___

Contribution Margin Ratio, Break-Even Sales Revenue, Sales Revenue for Target Profit
Schylar Pharmaceuticals, Inc., plans to sell 135,000 units of antibiotic at an average price of $21 each in the coming year. Total variable costs equal $1,077,300. Total fixed costs equal $8,400,000.
Required:
1. What is the contribution margin per unit? Round your answer to the nearest cent.
What is the contribution margin ratio? Round your answer to two decimal places. (Express as a decimal-based answer rather than a whole percent amount.)
2. Calculate the sales revenue needed to break even. Round your answer to the nearest dollar.
3. Calculate the sales revenue needed to achieve a target profit of $295,000. Round your answer to the nearest dollar.
4. What if the average price per unit increased to $22.50? Recalculate the following:
a. Contribution margin per unit. Round your answer to the nearest cent.
b. Contribution margin ratio. Enter your answer as a decimal value (not a percentage), rounded to four decimal places.
c. Sales revenue needed to break even. In your computations, use your rounded answer from part (4-b) above for the contribution margin ratio, and round your final answer to the nearest dollar.
d. Sales revenue needed to achieve a target profit of $295,000. In your computations, use your rounded answer from part (4-b) above for the contribution margin ratio, and round your final answer to the nearest dollar.
Transcribed Image Text:Contribution Margin Ratio, Break-Even Sales Revenue, Sales Revenue for Target Profit Schylar Pharmaceuticals, Inc., plans to sell 135,000 units of antibiotic at an average price of $21 each in the coming year. Total variable costs equal $1,077,300. Total fixed costs equal $8,400,000. Required: 1. What is the contribution margin per unit? Round your answer to the nearest cent. What is the contribution margin ratio? Round your answer to two decimal places. (Express as a decimal-based answer rather than a whole percent amount.) 2. Calculate the sales revenue needed to break even. Round your answer to the nearest dollar. 3. Calculate the sales revenue needed to achieve a target profit of $295,000. Round your answer to the nearest dollar. 4. What if the average price per unit increased to $22.50? Recalculate the following: a. Contribution margin per unit. Round your answer to the nearest cent. b. Contribution margin ratio. Enter your answer as a decimal value (not a percentage), rounded to four decimal places. c. Sales revenue needed to break even. In your computations, use your rounded answer from part (4-b) above for the contribution margin ratio, and round your final answer to the nearest dollar. d. Sales revenue needed to achieve a target profit of $295,000. In your computations, use your rounded answer from part (4-b) above for the contribution margin ratio, and round your final answer to the nearest dollar.
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