Please answer all parts of the question with detailed explanation so i can undertrstand

Question 3 (20 points) Question based on modified problems 3.3 from the reference text [Flynn (2009)] from page 78 of the textbook Polymerco, a North American manufacturer of specialty polymers, has the following highly condense income statement, given in the table below. There current sales are to North American customers only. The president casually mentions that it would be nice to have more offshore sales to diversity the company Polymerco Income Statement This year ($000) Last year ($000 25,421 24,224 Gross sales Nil Bad debt ni 25,421 22,243 3,178 12.5 2,122 1,056 Net sales 24,224 21,341 2,883 11.9 COGS Contribution margin CM SG&A 2,067 816 -50 ating income Other income and interest on long-term debt -60 Net income 996 766 What are your recommendations for the following situations? Do you have any concern? (a) if Polymerco's production is running at 84% capacity. (10 points) (b) if Polymerco's production is running at 100% capacity. (10 points)