JC company sells a product for $20 with variable costs of $6 and fixed costs of $792,000. The contribution margin is $14 and 70%. If variable costs rise to $7, the contribution margin percentage is 65%. Total Man company sells cologne bottles for $7.50 with variable costs of $0.45 and fixed costs of $900,000. It needs to sell 120,000 bottles to break even, with total revenue and total costs both equaling $900,000 at the break even point.

1. 1. JC company sells a product for $20.00 which has a variable cost of $6 and fixed costs of
$792,000.
a. Find the contribution margin $_____ for the product JC company sells based on the
information in the problem and contribution margin % ________%. Show your work in detail.
b. Suppose the variable cost has been increased to $7 because of inflation. What will be the
contribution margin % _______% in the problem with all other factors remain the same. Show
your work.
2. Total Man company has developed a cologne that has a unit variable cost of $0.45 for a three
ounce bottle and total fixed cost of $900,000. The company plans to sell each bottle for $7.50.
a. Find out how many bottles does the company need to sell to break even? Must show the work.
b. Compute the TR at the BE point. _$________________ Show the work.
c. Compute the TC at the BE point. _$________________ Show the work.