Brooke Manufacturing sold 405.000 units of its product for $70 per unit in 2020 Variable cost per unit is $58, and total fixed costs are $1,620,000. Read the requirements Requirement 1. Calculate (a) contribution margin and (b) operating income (a) Determine the formula used to calculate the contribution margin The contribution margin is Contribution margin (b) Determine the formula used to calculate the operating Income Operating Income Operating income h Requirement 2. Brooke's current manufacturing process is tabor intensive Kate Keller, Brooke's production manager, has proposed investing in state-of-the-art manufacturing equipment, which will increase the annual fixed costs to $5,265,000. The variable costs are expected to decrease to $56 per unit Brooke expects to maintain the same sales volume and selling price next year. How would acceptance of Keller's proposal affect your answers to (a) and (b) in requirement 12 Recalculate (a) and (b) if the proposal is accepted. (a) The contribution margin would be -2 m (b) Operating income would change to under Keller's proposal Next 22 mi 22 pm Requirement 2. Brooke's current manufacturing process is labor intensive. Kate Keller, Brooke's production manager, has proposed investing in state-of-the-art manufacturing equipment, which will increase the annual foxed costs to $5,265,000 The variable costs are expected to decrease to $56 per unit. Brooke expects to maintain the same sales volume and selling price next year. How would acceptance of Keller's proposal affect your answers to (a) and (b) in requirement 17 Recalculate (a) and (b) if the proposal is accepted (a) The contribution margin would be (b) Operating income would change to under Keller's proposal Requirement 3. Should Brooke accept Keller's proposal? Explain Operating income is expected to income alone, Brooke should the proposal Based on the operating Manangement would consider other factors before making the final decision. It is likely that product improve as a result of using state-of-the-art equipment. However, the Quality proposal the company's foced cost. This will the company's operating leverage and risk urse (ACC 2411 Cost Acc Accounting 17 Next