Houston$-$based Advanced Electronics manufactures audio speakers for desktop computers. The following data relate to the period just ended when the company produced and sold $40,000$ speaker sets:

Sales $ $3,280,000$

Variable costs $820,000$

Fixed costs $2,310,000$

Management is considering relocating its manufacturing facilities to northern Mexico to reduce costs. Variable costs are expected to average $$16\mathrm{.}00$ per set; annual fixed costs are anticipated to be $$1,984,000.($In the following requirements, ignore income taxes.$)$

Required:

$1.$ Calculate the company$$s current income and determine the level of dollar sales needed to double that figure, assuming that manufacturing operations remain in the United States.

$2.$ Determine the break$-$even point in speaker sets if operations are shifted to Mexico.

$3.$ Assume that management desires to achieve the Mexican break$-$even point; however, operations will remain in the United States.

a$.$ If variable costs remain constant, by how much must fixed costs change?

b$.$ If fixed costs remain constant, by how much must unit variable cost change?

$4.$ Determine the impact $($increase$,$ decrease, or no effect$)$ of the following operating changes.