Due to erratic sales of its sole producta high-capacity battery for laptop computersPEM, 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 at $20 per unit) $262,000 Variable expenses 131,000 Contribution margin 131,000 Fixed expenses 146,000 Net operating loss $(15,000) -------------------------------------------------------------------------------- Refer to the original data. By automating certain operations, the company could reduce variable expenses in half. However, fixed costs would increase by $118,000 each month. (a) Compute the new CM ratio and the new break-even point in both units and dollars. (Do not round intermediate calculations. Round Break-even point in units to the nearest whole number. Round Break-even point in dollars to the nearest dollar amount. Omit the "%" and "$" signs in your response.) CM ratio % Break-even point in units units Break-even point in dollars $ -------------------------------------------------------------------------------- (b) Assume that the company expects to sell 20,300 units next month. Prepare two contribution format income statements, one assuming that operations are not automated and one assuming that they are. (Show data on a per unit and percentage basis, as well as in total, for each alternative.) (Input all amounts as positive values. Round your per unit cost to 1 decimal place and all other answers to the nearest dollar, percentage values. Omit the "$" and "%" signs in your response.) Not Automated Automated Total Per Unit % Total Per Unit % Sales (20,300 units) $ $ $ $ Variable expenses Contribution margin $ $ Fixed expenses Net operating income $ $