$2-69$ CVP in a Modern Manufacturing EnvironmentA division of Hewlett$-$Packard Company changed its production operations from one where a large labor force assembled electronic components to an automated production facility dominated by computer$-$controlled robots. The change was necessary because of fierce competitive pressures.Improvements in quality, reliability, and flexibility of production schedules were necessary just to match the competition. As a result of the change, variable costs fell and fixed eosts increased, as shown in the following assumed budgets:Old Production OperationNew Production OperationUnit variable costMaterial$$86\mathrm{.}88$Labor$1,22\mathrm{.}22$Total per unit$$2\mathrm{.}10$$$1\mathrm{.}10$Monthly fixed costsRent and depreciation$$450,000$$ $875\mathrm{.}000$Supervisory labor$80,000175\mathrm{.}000$Other$50,00090,000$Total per month$$580,000$$$1,140\mathrm{.}000$