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 income statement is as follows:

Sales $$188,000,000$

Cost of goods sold $(99,000,000)$

Gross profit $$89,000,000$

Expenses:

Selling expenses $$14,000,000$

Administrative expenses $16,400,000$

Total expenses $(30,400,000)$

Operating income $$58,600,000$

The division of costs between variable and fixed is as follows:

Variable Fixed

Cost of goods sold $70\%30\%$

Selling expenses $75\%25\%$

Administrative expenses $50\%50\%$