c) What will be the Break-Even point in units be with the increased costs? d) If they produce and sell 8,000 units with the increased variable expenses, what will their Net Operating Income, NOI, be? e) How many units will Dorilane need to sell to maintain the same operating income as expected (using NEW cost structure from 2b? Note this is the NOI calculated in 36 above. NOI = 1,264,880 f) To compensate for the increased cost, assume Dorilane Company is willing to increase its sales price. If they need to make a minimum profit of $2,000,000 to keep its creditors and investors happy. What minimum sales price will they need to charge if they produce and sell 8,000 units with the increased variable expenses? Hint: Remember that CM = Sales price - Variable expenses. g) Conclusion: Use your calculation above, should Dorilane be concerned about future costs increases? Should they consider shutting down their operations or is there sufficient lei way for the Dorilane Company to make reasonable adjustments and stay in business. Make sure your answer uses complete sentences and includes 30 to 50 words and support your answer with calculations observed previously in the project. Note - When graded, there are no right or wrong answers to these types of questions. Grading is based on how well you demonstrate your understanding of the material and if your answer/conclusions are consistent with previous work done in the project requirements. Looking at changes: Dorilane is not confident their NEW cost structure will hold beyond the firsts few years. Management wants to examine the potential impact of the following situations. 4) Increase to costs: The production manager is anticipating inflation and other increases that will result in total variable expenses increasing by 20%. Remember to calculate this change to the NEW Profit Formula from 2b. (Use concepts covered in Lecture Packet 1.2 as reference) a) Assuming the increase to expenses calculate the following: i) What will be the revised variable cost per unit? (show 2 decimals) 218.27 ii) What will be the revised contribution margin per unit? (show 2 decimals) 224.73 iii) What will the revised profit formula be? REVISED profit formula: NOI = 224.73 Q-824,000 b) What will the CM ratio? Note - Requirement asks for CM (contribution margin) ratio, NOT contribution margin in dollars or contribution per unit