Need help with 1,2,3,4

Morton Companys contribution format income statement for last month is given below $1,392.000 974 400 Sales (48.000 units 520 per unit) Variable expenses Contribution margin Fondeneses Net operating income The Industry in which Morton Company operates is quite sensitive to cyclical movements in the economy. Thus, profits very considerably from year to year according to general economic conditions. The company has a large amount of unused capacity and is studying ways of improving profits Required: 1. New equipment has come onto the market that would allow Morton Company to automate a portion of its operations. Variable expenses would be reduced by $8.70 per unit. However, fed expenses would increase to a total of $751,600 each month. Prepare two contribution format income Matements, one showing present operations and one showing how operations would appear if the new equipments purchased (Round your Per unit answers to 2 decimal places.) Morton Company Contribution Income Statement Present Amount Per Unit Proposed Amount Per Unit 0 5 0 .00 2. Refer to the income statements in (1) above. For both present operations and the proposed new operations, compute a. The degree of operating leverage. Present Proponed Degree of operating leverage b. The break-even point in dollar sales. Present Proposed Break-even point in dollar sales c. The margin of safety in both dollar and percentage terms. Present Proposed Margin of safety in dollar sales Margin of safety in percentage 3. Refer again to the data in (1) above. As a manager, what factor would be paramount in your mind in deciding whether to purchase the new equipment? (Assume that enough funds are available to make the purchase.) O Reserves and surplus of the company Performance of peers in the indstry Stock level maintained O Cyclical movements in the economy 4. Refer to the original data. Rather than purchase new equipment, the marketing manager argues that the company's marketing strategy should be changed. Rather than pay sales commissions, which are currenoy Included in variable expenses, the company would pay salespersons foed salaries and would invest heavily in advertising. The marketing manager claims this new approach would increase in sales by 50% without any change in selling price, the company's new monthly foued expenses would be $417,600, and is not operating income would increase by 25%. Compute the break-even point in dollar sales for the company under the new marketing strategy Now break even point in dollar sales