Midlands Inc. had a bad year in 2016. For the first time in its history, it operated at a loss. The company's income statement showed the following results from selling 79,000 units of product: net sales $1,975,000; total costs and expenses $1,805,000; and net loss $-170,000. Costs and expenses consisted of the following. Total Variable Fixed $503,000 Cost of goods sold Selling expenses $1,148,000 510,000 $645,000 90,000 420,000 Administrative expenses 147,000 $1,805,000 55,000 92,000 $790,000 $1,015,000 Management is considering the following independent alternatives for 2017. 1. Increase unit selling price 30% with no change in costs and expenses. 2. Change the compensation of salespersons from fixed annual salaries totaling $205,000 to total salaries of $36,000 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) Compute the break-even point in dollars for 2017. (Round contribution margin ratio to 2 decimal places eg. 0.25 and final answer to 0 decimal places, e.g. 2,510.) Break-even point $ 2030000 (b) Compute the break-even point in dollars under each of the alternative courses of action. (Round contribution margin ratio to 4 decimal places e.g. 0.2512 and final answers to O decimal places, e.g. 2,510.) Break-even point 1. Increase selling price $ 1466111 2. Change compensation + 1537500 3. Purchase machinery + 1716500 Which course of action do you recommend? Alternative 1