campbell company currently produces and sells 7,400 units annually of product that has a variable cost of $11 per unit and annual fixed costs of $249,000. the company currently earns a $84,000 annual profit. assume that campbell has the opportunity to invest in new labor-saving production equipment that will enable the company to reduce variable costs to $9 per unit. the investment would cause fixed costs to increase by $10,500 because of additional depreciation cost.

a. use the equation method to determine the sales price per unit under existing conditions (current equipment is used).

b. prepare a contribution margin income statement, assuming that campbell invests in the new production equipment