Memofax, Inc. produces memory enhancement software for computers. Sales have been very erratic, with some months showing a profit and some months showing a loss. The company's contribution format income statement for the most recent month is given below:

Sales (22,000 units)	$	550,000
Less: Variable expenses		330,000
Contribution margin		220,000
Less: Fixed expenses		225,000
Net operating loss	$	(5,000)

1.Refer to the original data. By automating, the company could slash its variable expenses in half. However, fixed costs would increase by $41,000 per month.

a. Compute the new CM ratio and the new break-even point in both units and dollars.(Do not round intermediate calculations. Round your "Contribution margin ratio" answer to 2 decimal places. Round your "Break-even point" answers up to nearest whole number.)

b. Assume that the company expects to sell 27,000 units next month. Prepare two contribution format income statements: one assuming that operations are not automated, and one assuming that they are.(Do not round intermediate calculations. Round "Per Unit" and "Percentage" to 2 decimal places.)

d. What is the point of indifference between the two options?(Do not round intermediate calculations. Round your answer up to nearest whole number.)