74 ints Skipped eBook References (Mayor Applications, CONTULI may nauu, DIOR EVE OFFE [LO5-1, LO5-3, LO5-4, LO5-5, LO5-6] Due to erratic sales of its sole product-a high-capacity battery for laptop computers-PEM, Incorporated, has been experiencing financial difficulty for some time. The company's contribution format income statement for the most recent month is given below Sales (13,000 units $30 per unit) Variable expenses Contribution margin Fixed expenses Net operating loss Required: $390,000 234,000 156,000 174,000 $ (18,000) 1. Compute the company's CM ratio and its break-even point in unit sales and dollar sales. 2. The president believes that a $6.300 increase in the monthly advertising budget, combined with an intensified effort by the sales staff, will increase unit sales and the total sales by $82.000 per month. If the president is right, what will be the increase (decrease) in the company's monthly net operating Income? 3. Refer to the original data. The sales manager is convinced that a 10% reduction in the selling price, combined with an increase of $37,000 in the monthly advertising budget, will double unit sales. If the sales manager is right, what will be the revised net operating Income (loss)? 4. Refer to the original data. The Marketing Department thinks that a fancy new package for the laptop computer battery would grow sales. The new package would increase packaging costs by $0.50 per unit. Assuming no other changes, how many units would have to be sold each month to attain a target profit of $4,300? 5. Refer to the original data. By automating, the company could reduce variable expenses by $3 per unit. However, fixed expenses would increase by $52.000 each month. a. Compute the new CM ratio and the new break-even point in unit sales and dollar sales. b. Assume that the company expects to sell 20.400 units next month. Prepare two contribution format income statements, one assuming that operations are not automated and one assuming that they are. (Show data on a per unit and percentage basis, as well as in total, for each alternative.) c. Would you recommend that the company automate its operations (Assuming that the company expects to sell 20-400 units? would increase by $52,000 each month. a. Compute the new CM ratio and the new break-even point in unit sales and dollar sales. b. Assume that the company expects to sell 20,400 units next month. Prepare two contribution format income statements, one assuming that operations are not automated and one assuming that they are. (Show data on a per unit and percentage basis, as well as in total, for each alternative.) c. Would you recommend that the company automate its operations (Assuming that the company expects to sell 20,400 units)? Complete this question by entering your answers in the tabs below. ok ences Req 1 Req 2 Req 3 Req 4 Req 5A Req 58 Req 5C Compute the company's CM ratio and its break-even point in unit sales and dollar sales. (Do not round intermediate calculations. Round "CM ratio" to the nearest whole percentage (1.e., 0.234 should be entered as "23"). CM ratio Break-even point in unit sales Break-even point in dollar sales Reg 1 Req 2 > 4 Application Assignment 3 would increase by $52.000 each month. Seved its Skipped a. Compute the new CM ratio and the new break-even point in unit sales and dollar sales. b. Assume that the company expects to sell 20.400 units next month. Prepare two contribution format income statements, one assuming that operations are not automated and one assuming that they are. (Show data on a per unit and percentage basis, as well as in total, for each alternative.) c. Would you recommend that the company automate its operations (Assuming that the company expects to sell 20,400 units)? Complete this question by entering your answers in the tabs below. etlook eferences Req 1 Req2 Req 3 Req 4 Req SA Req 58 Req SC The president believes that a $6,300 increase in the monthly advertising budget, combined with an intensified effort by the sales staff, will increase unit sales and the total sales by $82,000 per month. If the president is right, what will be the increase (decrease) in the company's monthly net operating income? (Do not round intermediate calculations.) by 3 14 points Skipped to be sold eat on to dilati a target prot of 4: 5. Refer to the original data. By automating, the company could reduce variable expenses by $3 per unit. However, fixed expenses would increase by $52.000 each month. a. Compute the new CM ratio and the new break-even point in unit sales and dollar sales. b. Assume that the company expects to sell 20,400 units next month. Prepare two contribution format income statements, one assuming that operations are not automated and one assuming that they are. (Show data on a per unit and percentage basis, as well as in total, for each alternative.) c. Would you recommend that the company automate its operations (Assuming that the company expects to sell 20.400 units)? Complete this question by entering your answers in the tabs below. eBook References Req 1 Req 2 Red 3 Req 41 Req 5A Req 58 Req SC Refer to the original data. The sales manager is convinced that a 10% reduction in the selling price, combined with an increase of $37,000 in the monthly advertising budget, will double unit sales. If the sales manager is right, what will be the revised net operating income (loss)? (Losses should be entered as a negative value.) Revised not operating income (loss) < Req 2 Req 4 > 3 would increase by $52.000 each month. 714 points Skipped a. Compute the new CM ratio and the new break-even point in unit sales and dollar sales. b. Assume that the company expects to sell 20,400 units next month. Prepare two contribution format income statements, one assuming that operations are not automated and one assuming that they are. (Show data on a per unit and percentage basis, as well as in total, for each alternative.) c. Would you recommend that the company automate its operations (Assuming that the company expects to sell 20,400 units)? Complete this question by entering your answers in the tabs below. eBook References Req 1 Req 2 Req 3 Req 4 Req 5A Req 58 Reg SC Refer to the original data. The Marketing Department thinks that a fancy new package for the laptop computer battery would grow sales. The new package would increase packaging costs by $0.50 per unit. Assuming no other changes, how many units would have to be sold each month to attain a target profit of $4,300? (Do not round intermediate calculations. Round final answer up to the nearest whole unit.) Linit sales to attain target profit Show less A 3 would increase by $52,000 each month. 14 oints Skipped a. Compute the new CM ratio and the new break-even point in unit sales and dollar sales. b. Assume that the company expects to sell 20,400 units next month. Prepare two contribution format income statements, one assuming that operations are not automated and one assuming that they are. (Show data on a per unit and percentage basis, as well as in total, for each alternative.) c. Would you recommend that the company automate its operations (Assuming that the company expects to sell 20.400 units)? Complete this question by entering your answers in the tabs below. eBook Req 1 ferences Reg 21 Req 3 Reg 4 Red SA Req 58 Req SC Refer to the original data. By automating, the company could reduce variable expenses by $3 per unit. However, fixed expenses would increase by $52,000 each month. Compute the new CM ratio and the new break even point in unit sales and dollar sales. (Do not round intermediate calculations, Round "CM ratio" to the nearest whole percentage (ie., 0.234 should be entered as "23"), round "Break even point in unit sales" up to the nearest whole unit and round "Break even point in dollar sales" to the nearest whole dollar.) Show less A CM ratio Break-even point in unit sales Break-even point in dollar sales 3 Req 1 Req 2 Req 3 Req 4 Req 5A- Req 58 Req 5C 714 points Skipped etlook References Refer to the original data. By automating, the company could reduce variable expenses by $3 per unit. However, fixed expenses would increase by $52,000 each month. Assume that the company expects to sell 20,400 units next month. Prepare two contribution format income statements, one assuming that operations are not automated and one assuming that they are. (Show data on a per unit and percentage basis, as well as in total, for each alternative.) (Do not round your intermediate calculations Round your percentage answers to the nearest whole number.) PEM, Incorporated Contribution Income Statement Total Not Automated Automated Per Unit % Total Per Unit Show less & 0 $ 0 0 0 $ 0 0 $ 0 $ 0 714 3 would increase by $52,000 each month. points Skipped a. Compute the new CM ratio and the new break-even point in unit sales and dollar sales. b. Assume that the company expects to sell 20,400 units next month. Prepare two contribution format income statements, one assuming that operations are not automated and one assuming that they are. (Show data on a per unit and percentage basis, as well as in total, for each alternative.) c. Would you recommend that the company automate its operations (Assuming that the company expects to sell 20,400 units)? Complete this question by entering your answers in the tabs below. eBook References Req 1 Req 21 Req 3 Req 4 Req SA Req 58 Req 5C Refer to the original data. By automating, the company could reduce variable expenses by $3 per unit. However, fixed expenses would increase by $52,000 each month. Would you recommend that the company automate its operations (Assuming that the company expects to sell 20,400 units)? OYes ONO