Faxmatic, Inc., produces memory enhancement kits for fax machines. Sales have been very erratic, with some months showing a profit and some months showing a loss. The company's contribution format income statement for the most recent month is given below:

Sales (17,000 units at $55 per unit)	$	935,000
Variable expenses		561,000
Contribution margin		374,000
Fixed expenses		385,000
Net operating loss	$	(11,000)

1.Refer to the original data. The companys advertising agency thinks that a new package would help sales. The new package being proposed would increase packaging costs by $1.1 per unit. Assuming no other changes, how many units would have to be sold each month to earn a profit of $5,100? (Do not round intermediate calculations. Round your final answer to the nearest whole number.)

SALES UNITS:_____________

Refer to the original data. By automating, the company could slash its variable expenses in half. However, fixed costs would increase by $124,000 per month.

2.Compute the new CM ratio and the new break-even point in both units and dollars. (Do not round your intermediate calculations. Round up your final break even answers to the nearest whole number.) CM:_____________% BREAK EVEN IN UNITS AND DOLLARS:_______________________ 3.Assume that the company expects to sell 21,700 units next month. Prepare two contribution format income statements, one assuming that operations are not automated and one assuming that they are. (Round "Per unit" answers to 1 decimal place.)