HW LO 38 39 PROBLEM 3-20 Various CVP Questions: Break-Even Point; Cost Structure; Target Sales (L03-1, L03-3, LO3-4, LO3-5, L03-6, L03-8) Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $15 per ball, of which 60% is direct labor cost. Last year, the company sold 30,000 of these balls, with the following results: Sales (30,000 balls). Variable expenses. Contribution margin Fixed expenses... Net operating income $750,000 450.000 300,000 210,000 $ 90,000 Required: 1. Com 1h the degree of operating ......CUSCH or rates, the company es males wat vana.. mccrupuy SE Ccreased 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company's new CM ratio and new break-even point in balls? ve me then 30.000 balls