ase of $11,280,000 in yearly sales. The expansion will increase fixed costs by $5,000,000 but will not affect the relationship Break-even sales under present and proposed conditions Portmann Company, operating at full capacity, sold 1,000,000 units at a price of $188 per unit during the current year. Its The division of costs between variable and fixed is as follows: Management is considering a plant expansion program for the following year that will permit an increase of $11,280,000 between sales and variable costs. Required: 1. Determine the tota variable costz and the total fixed costs for the current year. Total variable costs 3 Total fixed costs 5 2. Determine (a) the unit varlable cost and (b) the unit contribution margin for the current year. Unit variable cont? Unit contribution margin s 1. Determine the total variable cossts and the tatal foied costs for the currern veac Total variable coits 1 Total fixed costs 4 2. Determine (a) the unit varlable cost and (b) the unit conknbution margin for the current reat: Unit varlable cont Unit centribution margin 3. Comoute the becakeven sales (units) for the current vas. units 4. Compute the hreak-even sales (units) under the proposed program for the following reat. x unites x units 6: Decermine the maximum operabng income passible with the expanded plart. 7. If the proposal is accepted and saies remain at the orrent level, what will the openting income or less be for the follawing rear? 8. Based on the data given, would you recommend accepting the proposar? a. In favor of the proposal because of the reduction in break even poire. b. In faver of the proposal because of the possiblity of increating income from operationa. cin frwor of the proposal becsuse of the increase in breakeven point. Chosse the correct andver Brakerts sales unser present and propoled condeions Nlovuired: units 4. Compute the break-even sales (units) under the proposed program for the following year. x units 5. Determine the amount of sales (units) that would be necessary under the proposed program to realize the $60,000,000 of x units 6. Determine the maximum operating income possible with the expanded plant: x 7. If the proposal is accepted and sales remain at the current level, what will the operating income or loss be for the following x 8. Based on the data given, would you recommend accepting the proposal? a. In favor of the proposal because of the reduction in break-even point. b. In favor of the proposal because of the possiblity of increasing income from operations. c. In favor of the proposal because of the increase in break-even point. d. Reject the proposal because if future sales remain at the current level, the income from operations will increase. e. Reject the proposal because the sales necessary to maintain the current income from operations would be below the current