6. a. The contribution margin ratio is $15,000 ÷ $60,000 = 25%.

Therefore, the break-even in sales dollars is $18,000 ÷ 25% = $72,000.

b. The variable cost ratio is $45,000 ÷ $60,000 = 75%. Therefore, the variable

expenses at the break- even point are $72,000 x 75% = $54,000.

c. 25% See part (a) above.

(d.)

Sales ($60,000 x 1.1) $66,000

Less variable expenses ($45,000 x 1.1) 49,500

Contribution margin 16,500

Less fixed expenses ($18,000 -$2,000) 16,000

Net income $ 500