Midwest Manufacturing Statement of Income 2018 2016 2017 $ 5,635,357 $5,804,418 $6,152,683 Sales Cost of Goods Sold: Variable Costs 1,784,278 369,161 2,153,439 1,393,060 1,465,193 394,475 1,859,668 522,398 Fixed Costs Total Cost of Goods Sold 1,915,458 3,999,244 3,888,960 Gross Profit 3,775,689 Administrative & Selling Expenses: Variable Administrative &Selling Costs Fixed Administrative & Selling Costs 522,978 1,015,193 522,398 394,475 958,011 1,102,839 1,538,171 1,352,486 1,625,237 Total Administrative Costs 2,423,204 $ 2,263,723 $ 2,461,073 Net Income Supplemental Information 2018 2016 2017 Unit Costing Summary: 107,489 118,321 100,631 Units Sold 75,474 75,242 76,909 Direct Labor Hours Attached is the financial information needed from Midwest Manufacturing to answer the questions below. The questions below must be turned in June 10, 2019 at 11:59 PM. This assignment is required to be completed using Excel, all calculations must be reflected in your spreadsheet. 1) What is the (a) breakeven in units and (b) margin of safety in units for (i) 2016, (ii) 2017, and (iii) 2018? (25 Points) A new piece of manufacturing equipment is being considered for purchase. This machine is projected to reduce total cost of goods sold by 18% (based on 2018 actual results) and have a useful life of 5 years. If the machine costs $2,500,000 should it be purchased? Explain. (20 Points) 2) The company has calculated that 40% of the variable cost of goods sold are attributable to direct materials, and that 60% of the variable cost of goods sold are associated with direct labor. 3) What is the direct materials cost per item for 2018? (10 Points) It is projected that the number of units sold for 2019 will increase by 5% from 2018. No change in inventory is scheduled for 2019: What is the production budget, in units, for 2019 in units? (10 Points) 4) It is expected that the cost of direct materials will increase by 3% from 2018 to 2019. What is the direct materials budget, in dollars, for 2019? (15 Points) 5) 6) What was the direct labor hours per unit for (rounded to the nearest .01) (i) 2017 and (ii) 2018? (15 Points) It is budgeted that the direct labor hours per unit from 2018 will be the same for 2019. It is also budgeted that the direct labor rate for 2019 will increase by 2% from 2018. 7) What is the direct labor budget, in dollars, for 2019? (15 Points) When drafting the budget for 2018 the standard hourly rate was set at $12.56 for direct labor. What is the direct labor rate variance for 2018? (15 Points) 8)