: Suppose that Adams Company sells a product for $20. Unit costs are as follows:Suppose that Adams Company sells a product for $20. Unit costs are as follows:Direct materials $3.90Direct labor 1.40Variable factory overhead 2.10Variable selling and administrative expense 1.60Total fixed factory overhead is $52,000 per year, and total fixed selling and administrativeexpense is $38,530.Required:1. Calculate the variable cost per unit and the contribution margin per unit.2. Calculate the contribution margin ratio and the variable cost ratio.3. Calculate the break-even units.4. Prepare a contribution margin income statement at the break-even number of units. View less »