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Super Sales Company is the exclusive distributor for a high-quality knapsack. The product sells for $140 per unit and has a CM ratio of 40%. The company’s fixed expenses are $441,000 per year. The company plans to sell 8,000 knapsacks this year.Required:1.What are the variable expenses per unit?2.Use the equation method for the following:a.What is the break-even point in units and in sales dollars?b.What sales level in units and in sales dollars is required to earn an annual profit of $105,000?c.What sales level in units is required to earn an annual after-tax profit of $105,000 if the tax rate is 25%?d.Assume that through negotiation with the manufacturer, Super Sales Company is able to reduce its variable expenses by $7 per unit. What is the company’s new break-even point in units and in sales dollars? (Do not round intermediate calculations. Round your final answers to the nearest whole number.)3.Use the formula method for the following:a.What is the break-even point in units and in sales dollars?b.What sales level in units and in sales dollars is required to earn an annual profit of $105,000?c.What sales level in units is required to earn an annual after-tax profit of $105,000 if the tax rate is 25%?d.Assume that through negotiation with the manufacturer, Super Sales Company is able to reduce its variable expenses by $7 per unit. What is the company’s new break-even point in units and in sales dollars? (Do not round intermediate calculations. Round your final answers to the nearest whole number.)
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