Gorham Manufacturings sales slumped badly in 2020. For the first time in its history, it operated at a loss. The company's income statement showed the following results from selling 66,000 units of product: net sales $2,046,000; total costs and expenses $2,237,100; and net loss $191,100. Costs and expenses consisted of the amounts shown below:

		Total		Variable		Fixed
Cost of goods sold		$1,521,100		$1,068,900		$452,200
Selling expenses		524,000		137,000		387,000
Administrative expenses		192,000		124,000		68,000
		$2,237,100		$1,329,900		$907,200

Management is considering the following independent alternatives for 2021.

1.	Increase the unit selling price by 25% with no change in costs, expenses, or sales volume.
2.	Change the compensation of salespersons from fixed annual salaries totalling $213,000 to total salaries of $18,000 plus a 5% commission on net sales.
3.	Purchase new high-tech factory machinery that will change the proportion between variable and fixed cost of goods sold to 50:50.

(a)

Calculate the break-even point in dollars for 2020.

b) Contribution margin

Break-even point

$