1 Book Show Me How Print item Break Even Sales Under Present and Proposed Conditions Portmann Company, operating at hull capacity, sold 1,000,000 units at a price of $187 per unit during the current year. It income statement is as follows: Sales $187,000,000 Cost of goods sold (102,000,000) Gross profit $85,000,000 Expenses: Selling expenses $14,000,000 Administrative expenses 10,200,000 Total expenses (24,200,000) Operating income $60,800,000 The division of costs between Variable and fed is as follows Variable Fixed Cost of goods sold 70% 30W Selling expenses 75% 25% Administrative 50% 50% expenses Management is considering a plant expansion program for the following year that will permit an increase of $11,220,000 in yearly sales. The expansion will reted costs by $4,000,000 but will not affect the relationship between sales and variable costs, Required: 1. Determine the total variatrie costs and the total fixed costs for the current year 87,000,000 Total variable costs BOR Show Me How Printa 1. Determine the total variable costs and the total costs for the current year Total variable costs 87,000,000 Totalfred costs 39,200,000 2. Determine (a) the unit variable cost and (b) the unit cortion margin or the current year Unit variable 100,000, X Unt contribution margin 100 3. Compute the break even as (units) for the current year 393.000 units 4. Compute the break even sales funt) under the proposed program for the following year 432,000 units 5. Determine the amount of sales (units) that would be necessary under the proposed program to the $60,000,000 of operation that was the current year 1,040,000 units 6. Determine the maximum Operating income possible on the depan 7. If the proposal is accepted and sales remain at the current level what the per comes for the year? Income 8. llased on the data given, would you recommend accepting the prodal a. In favor of the proposal because of the reduction in breakeven pont b. In favor of the proposal because of the possibility of increasing income from operations c. In favor of the proposal because of the increase in breakeven point d. Reject the proposal because it future sales main at the current level, the income from operations will increase e. Reject the proposal because the sales necessary to maintain the current income from certis would below the current Choose the correct answer Previous No) Check My Work Save and Ball Sur Aimant for Grading