Midlands Inc. had a bad year in 2016. For the first time in its history, it operated at a loss. The companys income statement showed the following results from selling 78,000 units of product: net sales $1,560,000; total costs and expenses $1,800,000; and net loss $240,000. Costs and expenses consisted of the following.

	TOTAL	VARIABLE	FIXED
COST OF GOODS SOLD	1,134,000	633,000	501,000
SELLING EXPENSES	520,000	91,000	429,000
ADMINISTRATIVE EXPENSES	146,000	56,000	90,000
	1,800,000	780,000	1,020,000

Management is considering the following independent alternatives for 2017.

1.		Increase unit selling price 20% with no change in costs and expenses.
2.		Change the compensation of salespersons from fixed annual salaries totaling $204,000 to total salaries of $45,000 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 2016. (Round contribution margin ratio to 2 decimal places e.g. 0.25 and final answer to 0 decimal places, e.g. 2,510.)

break-even point $2,040,000 [MY ANSWER]

		Break Even Point
1	Increase Selling price	$
2	Change Compensation	$
3	Purchase Machinery	$

Please show me how you get the solution