Kent Corporation produces a molded plastic casing, M\&M101, for many cell phones currently on the market. Summary data from its 2017 income statement follows. Janell Wooten, Kent's president, is very concerned about Kent Corporation's poor profitability. Data table More info She asks Wade Holcomb, production manager, and Freddie Whitley, controller, to see if there are ways to reduce costs. After 2 weeks, Wade returns with a proposal to reduce variable costs to 60% of revenues by reducing the costs Kent currently incurs for safe disposal of wasted plastic. Freddie and Wade have the following conversation: Freddie is concerned that this would expose the company to potential environmental liabilities. He tells Wade, "We would need to estimate some of these potential environmental costs and include them in our analysis." "You can't do that," Wade replies. "We are not violating any laws. There is some possibility that we may have to incur environmental costs in the future, but if we bring it up now, this proposal will not go through because our senior management always assumes these costs to be larger than they turn out to be. The market is very tough, and we are in danger of shutting down the company and costing all of us our jobs. The only reason our competitors are making money is because they are doing exactly what I am proposing." Requirements 1. Calculate Kent Corporation's breakeven revenues for 2017. 2. Calculate Kent Corporation's breakeven revenues if variable costs are 60% of revenues. 3. Calculate Kent Corporation's operating income for 2017 if variable costs had been 60% of revenues. 4. Given Wade Holcomb's comments, what should Freddie Whitley do