Compute the contribution margin of each box of candy. The contribution margin is $4 per box.

B.

1. Compute the contribution margin of each box of candy. The contribution margin is $4 per box.

2. Compute the number of boxes of candy that Yucki must sell each month to break even.  Round up to the nearest whole box. Yucki must sell 48,750 boxes to break even.

3. Compute the contribution margin ratio for a box of candy The contribution margin ratio for a box of candy is 40%
.
4. Compute the dollar amount of monthly sales Yucki needs to earn $2500,000 in profit.  (Round the contribution margin ratio to four decimal places.  Round sales up to the nearest dollar.) The dollar amount of monthly sales Yucki needs to earn is 6,737,500.

5. Prepare Yucki’s contribution margin income statement for June for sales of 275,000 boxes of candy.
Particulars
Sales 2,750,000
Less: variable cost 1,650,000
Contribution margin 1,100,000
Less: Fixed cost 195,000
Operating income 905,000
6. What is the degree of leverage for June sales of  275,000 boxes of candy? (Carry answer out to four decimal places.) The degree of leverage is 1.2154.

7. What is June’s margin of safety (in dollars and cents)? The margin of safety in dollars is 2,262,500 and 82.27%

8. By what percentage will operating income change if June’s sales volume is 25% higher?  (Round to two decimal places.) 30.39%

9. Prove your answer by comparing the difference in operating income after the change with the operating income before the change. There is a 30.39% difference
Particulars
Sales 3,437,500
Less: variable cost 2,062,500
Contribution margin 1,375,00
Less: fixed cost 195,000
Operating income after 25% increase of sales volume 1,180,000
Operating income before the increase 905,000
Change in operating income 275,000

C.