Due to erractic sales of its sole product - a high capacity battery for laptop computers-Pem Inc,. has been experiencing financial diffuculty for some time. The company's contribution format income statement for the most recent is given below :

Due to erratic sales of its sole product-a high-capacity battery for laptop computersPEM, Inc., has been experiencing fin difficulty for some time. The company's contribution format income statement for the most recent month is given below: Sales (13,000 units X $20 per unit) Variable expenses Contribution margin Fixed expenses Net operating loss $ 260,000 156,000 104,000 116,000 $ (12,000) Required: 1. Compute the company's CM ratio and its break-even point in unit sales and dollar sales. 2. The president believes that a $6,100 increase in the monthly advertising budget, combined with an intensified effort by the staff, will increase unit sales and the total sales by $88,000 per month. If the president is right, what will be the increase (decr. the company's monthly net operating income? 2 Pofor Refer to the original data. By automating, the company could reduce variable expenses by $3 per unit. However, fixed expenses would increase by $51,000 each month. Compute the new CM ratio and the new break-even point in unit sales and dollar sales. (Do not round intermediate calculations. Round "CM ratio" to the nearest whole percentage (i.e., 0.234 should be entered as "23") and other answers to the nearest whole number.) Show less BE CM ratio 55 % Break-even point in unit sales Break-even point in dollar sales