Break-Even Sales Under Preseht and Proposed Conditions Darby Company, operating at full capacity, sold 174,900 units at a price of $135 per unit during the current year, Its income statemeat is as foliows: The divislon of costs between variable and foxed is as follows: Management is considering a plant expansion program for the following year that will permit an increase of $2,160,000 in yearly sales the expansion wil increase fixed costs by $268,000, but will not affect the relationship between seles and variable costs. 1. Determine the total variable costs and the total fowed costs for the current year: 2. Determine (a) the unit yariable cost and (b) the unit contribution margin for the current year. 3. Compute the break-even sales (units) for the current year. units: 4. Compute the break-even sales (units) under the proposed program for the following year: units 5. Determine the amount of sales (units) that would be necessary under the proposed program to realize the $8,536,500 of income from operations that was earned in the current year. units 6. Determine the maximum income from operations possible with the expanded plant. 7. If the proposal is accopted and saies remain at the current level, what wil the income or loss from operations be for the following year? 3. Compute the break-even sales (units) for the current year unts 4. Compute the break-even sales (units) under the proposed program for the following year. units 5. Determine the amount of sales (units) that wouid be necessary under the proposed program to realize the 58 , 536,500 of income from operatians that aas earned in the current year. units 6. Determine the maximum income from operations possible with the expanded plant. 7. If the proposal is accepted and sales remain ot the current level, what will the income or loss from operations be for the followiog year? 8. Based on the data given, would you recommend accepting the progosal? a. In favor of the proposal because of the reduction in break-even point. 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 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 year sales. Choose the correct