Falcon Company manufactures the camera system for a DRONE assembly. Its manufacturing assembly plant is located in the middle east and started its operation in the year 2010. The company exported eighty percent of its production to the American and European drone companies. It has at least three competitors producing the same line of product for drone assembly in China, South Korea, and India. The CEO of Falcon Company is looking forward to its company strategies to cope-up with the stiff competition in the market. Selling price, raw material costs, labor costs, and distribution costs are just some of the items that the CEO is keen on considering for possible financial analysis. He directed his operation manager, purchasing manager, and finance manager for an urgent meeting to discuss this matter. The meeting will be focusing on strategies to further reduce the companys cost of production, and other product-related and overhead costs. The company estimated monthly costs and monthly sale revenues for this operation are given in Table 2. All costs are monthly except the company taxes. To start with the analysis, the officers determine the following:

(i) The breakeven point for this situation

(ii) Contribution margin

(iii) Using a production range from zero to 10,000 units a month, develop the following cost-volume-profit graphical presentation, and explain their significance.

(a) A breakeven chart

(b) A profit-volume graph

(iv) Discuss possible strategies of the company to decrease breakeven point, Contribution margin, and increase profitability without increasing the selling price per unit.

Please clear hand writing and photos. Thank you!

Table 2