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Midlands Inc. had a bad year in 2019. For the first time in its history, it operated at a loss. The company's income statement
Midlands Inc. had a bad year in 2019. 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 $1,580,000; total costs and expenses $1.968,240, and net loss $388,240. Costs and expenses consisted of the following Total Variable Fixed Cost of goods sold $1,307,600 $796,000 $511,600 Selling expenses 512,640 94,000 418.640 Administrative expenses 148,000 58,000. 90,000 $1.968,240 $948,000 $1,020,240 Management is considering the following independent alternatives for 2020. 1 Increase unit selling price 25% with no change in costs and expenses. 2. 3. Change the compensation of salespersons from fixed annual salaries totaling $200,000 to total salaries of $43,000 plus a 5% commission on net sales. 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 2019. (Round contribution margin ratio to 4 decimal places eg. 0.2512 and final answer to 0 decimal places, eg. 2,510.) Break-even point $
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