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Please answer QUESTION TWO XYZ Corporation sells its product at $80 per unit with a contribution margin of 40%. During 2016, Simplex sold 540,000 units
Please answer QUESTION TWO XYZ Corporation sells its product at $80 per unit with a contribution margin of 40%. During 2016, Simplex sold 540,000 units of its product; its total fixed costs are $2,100,000. Required: 1b Calculate the total contribution margin, the total variable costs, and the overall operating income. 2b The production manager has proposed modernizing the whole production process in order to save labor costs. However, the modernization of the production process will increase the annual fixed costs by $3,800,000. The variable costs are expected to decrease by 20%. The Corporation expects to maintain the same sales volume and selling price next year. How would the acceptance of the production manager's proposal affect your answers to the total contribution margin and the overall operating income in requirement 1b? 3b Should the Corporation accepts the production manager's proposal? Explain the effects on The costs and income
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