Gordon's Steel Parts produces parts for the automobile industry. The company has monthly fixed expenses of $610,000 and a contribution margin of 90% of revenues. Gordon feels like he's in a giant squeeze play: The automotive manufacturers are demanding lower prices, and the steel producers have increased raw material costs, Gordon's contribution margin has shrunk to 70% of revenues. The company's monthly operating income, prior to these pressures, was $335,000 Road the common Requirement 1. To maintain this same level of proft, what sales volume in sales revenue) must Gordon now achieve? Begin by identifying the formula to compute the sales in units at various levels of operating income using the contribution margin approach. Fixed expenses Operating income + Contribution margin ratio = Target sales in dollars (Round your answer up to the nearest whole dollar) Gordon must now achieve sales of to maintain the same level of profit. i Requirements x 1. To maintain this same level of profit, what sales volume (in sales revenue) must Gordon now achieve? 2.Gordon believes that his monthly sales revenue will only go as high as $1,050,000. He is thinking about moving operations overseas to cut fixed costs. If monthly sales are $1,050,000, by how much will he need to cut fixed costs to maintain his prior profit level of $335,000 per month? Print Done