Part A: Cost Volume Profit Analysis 20 marks a) You are the manager of two regions for Business Appliances Limited New Zealand. You oversee selling their famous washing machine in the North and the South regions. The selling price of the washing machine has been standardised at $800 per unit in New Zealand. The details of the product within these two regions are given below: North South Sales $4,000,000 $3,200,000 Variable cost $2,000,000 $1,760,000 Rent $500,000 $300,000 Salaries $300,000 $220,000 Other Fixed costs $400,000 $330,000 Required: i. Calculate and comment on the overall profits and breakeven sales (in $) for the North and South regions. Your answer should include the reasons for the different profits and break-even sales between the two regions. (8 marks) ii. Which of the two regions has a higher margin of safety (in units)? Show all workings? (2 marks) iii. You have been advised that the following changes may take place across both regions: a. Selling price will increase by 2% per unit; b. Variable costs will decrease by $20 per unit. Other changes: North region: Sales is likely to increase by 100 units with more advertising costing an additional $35,000. Other fixed costs will fall by 10%. South region: Sales is likely to increase by 200 units by hiring a new marketing executive costing $100,000 to promote the product. Additional variable cost per unit of $1 is likely to be incurred but the other fixed cost will decrease by $10,000. Required: Calculate the new overall profits and breakeven sales (in $) for both regions with the changes mentioned above. Which of these two regions will perform better? Support your answer with workings and a brief explanation. (10 marks)