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Coronado Inc had a bad year in 2019. For the first time in its history, it operated at a loss. The company's income statement showed

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Coronado Inc had a bad year in 2019. For the first time in its history, it operated at a loss. The company's income statement showed the following results from selling 78,000 units of product: net sales $1,560,000; total costs and expenses $1,800,000; and net loss $240,000. Costs and expenses consisted of the following. Total Variable Fixed Cost of goods sold $1,141,200 $633,000 $508,200 Selling expenses 512,800 91,000 421,800 Administrative expenses 146,000 56,000 90,000 $1,800,000 $780,000 $1,020,000 Management is considering the following independent alternatives for 2020. 1. Increase unit selling price 25% with no change in costs and expenses. Change the compensation of salespersons from fixed annual salaries totaling $204,000 to total salaries of $44,985 plus a 5% 2 commission on net sales 3. Purchase new high-tech factory machinery that will change the proportion between variable and fixed cost of goods sold to 50:50. (a) Compute the break-even point in dollars for 2019. (Round contribution margin ratio to 4 decimal places eg. 0.2512 and final answer too decimal places, eg. 2,510.) Break-even point (b) Compute the break-even point in dollars under each of the alternative courses of action for 2020. (Round contribution margin ratio to 3 decimal places eg. 0.251 and final answers to decimal places, eg. 2.510.) Break-even point 1. Increase selling price 2. Change compensation 3 Purchase machinery Which course of action do you recommend

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