Due to erratic sales of its sole producta high-capacity battery for laptop computersPEM, Inc., has been experiencing financial difficulty for some time. The companys contribution format income statement for the most recent month is given below:

Sales (12,900 units $20 per unit)	$	258,000
Variable expenses		154,800
Contribution margin		103,200
Fixed expenses		115,200
Net operating loss	$	(12,000	)

3) Refer to the original data. The sales manager is convinced that a 10% reduction in the selling price, combined with an increase of $35,000 in the monthly advertising budget, will double unit sales. If the sales manager is right, what will be the revised net operating income (loss)? (Losses should be entered as a negative value.)

4)Refer to the original data. The Marketing Department thinks that a fancy new package for the laptop computer battery would grow sales. The new package would increase packaging costs by 70 cents per unit. Assuming no other changes, how many units would have to be sold each month to attain a target profit of $4,000? (Do not round intermediate calculations. Round final answer to the nearest whole unit.)

5A) Refer to the original data. By automating, the company could reduce variable expenses by $3 per unit. However, fixed expenses would increase by $59,000 each month. Compute the new CM ratio and the new break-even point in unit sales and dollar sales. (Round "CM ratio" to the nearest whole percent and other answers to the nearest whole number.)

5B) Refer to the original data. By automating, the company could reduce variable expenses by $3 per unit. However, fixed expenses would increase by $59,000 each month. Assume that the company expects to sell 20,900 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.) (Do not round your intermediate calculations. Round your percentage answers to the nearest whole number.)

Due to erratic sales of its sole product-a high-capacity battery for laptop computersPEM, Inc., has been experiencing financial difficulty for some time. The company's contribution format income statement for the most recent month is given below: Sales (12,900 units X $20 per unit) Variable expenses Contribution margin Fixed expenses Net operating loss $ 258,000 154,800 103,200 115,200 $ (12,000) Reg 1 Reg 2 Reg 3 Reg 4 Req 5A Req 5B Reg 5C Refer to the original data. The sales manager is convinced that a 10% reduction in the selling price, combined with an increase of $35,000 in the monthly advertising budget, will double unit sales. If the sales manager is right, what will be the revised net operating income (loss)? (Losses should be entered as a negative value.) Revised net operating income (loss) Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Reg 4 Req 5A Req 5B Reg 5C Refer to the original data. The sales manager is convinced that a 10% reduction in the selling price, combined with an increase of $35,000 in the monthly advertising budget, will double unit sales. If the sales manager is right, what will be the revised net operating income (loss)? (Losses should be entered as a negative value.) Revised net operating income (loss) Complete this question by entering your answers in the tabs below. Req 1 Reg 2 Reg 3 Reg 4 Req 5A Req 5B Reg 5C Refer to the original data. By automating, the company could reduce variable expenses by $3 per unit. However, fixed expenses would increase by $59,000 each month. Compute the new CM ratio and the new break-even point in unit sales and dollar sales. (Round "CM ratio" to the nearest whole percent and other answers to the nearest whole number.) CM ratio Break-even point in unit sales Break-even point in dollar sales Reg 1 Reg 2 Reg 3 Reg 4 Req 5A Req 5B Req 5C Refer to the original data. By automating, the company could reduce variable expenses by $3 per unit. However, fixed expenses would increase by $59,000 each month. Assume that the company expects to sell 20,900 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.) (Do not round your intermediate calculations. Round your percentage answers to the nearest whole number.) Show less PEM, Inc. Contribution Income Statement Not Automated Total Per Unit % Automated Per Unit Total 0 $ 0 0 % 0 $ 0