Due to erratic sales of its sole product-a high-capacity battery for laptop computers-PEM, Inc., has been experiencing difficulty for some time. The company's contribution format income statement for the most recent month is given below: Sales (13,100 units x $40 per unit) Variable expenses $524,000 314,400 Contribution margin Fixed expenses 209,600 233,600 Net operating loss S (24,000) Required 1. Compute the company's CM ratio and its break-even point in both unit sales and dollar sales CM ratio Break-even point in units Break-even point in dollars 14,600 $ 584,000 2. The president believes that a $6,100 increase in the monthly advertising budget, combined with an intensified effort by the sales staff, will result in an $85,000 increase in monthly sales. If the president is right, what will be the effect on the company's monthly net operating income or loss? (Use the incremental approach in preparing your answer.) Increases