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 78,000 units of product: net sales $1,560,000; total costs and expenses $1,795,200, and net loss $235,200. Costs and expenses consisted of the following. Total Variable Fixed Cost of goods sold Selling expenses $1,115,600 $628,000 $487,600 526,600 94,000 432,600 153,000 58,000 95,000 $1.795,200 $780,000 $1,015,200 Administrative expenses Management is considering the following independent alternatives for 2020. 1. Increase unit selling price 25% with no change in costs and expenses. 2. Change the compensation of salespersons from fixed annual salaries totaling $202,000 to total salaries of $40,000 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 2019. (Round contribution margin ratio to decimal places eg. 0.2512 and final answer to decimal places, e.g. 2,510.) Break-even point $ LIITUWIU W TUCSO N prus, Ey. ,510.) Break-even point $ (b) Compute the break-even point in dollars under each of the alternative courses of action for 2020. (Round contribution margin ratio to 3 decimal places eg. 0.251 and final answers to decimal places, e-g. 2,510.) Break-even point 1. Increase selling price 2. Change compensation 3. Purchase machinery Which course of action do you recommend? e Textbook and Media Attempts: 0 of 3 used Submit Answer Save for Later Send to Gradebook