Portmann Company , need 5,6 and 7 answered

Break-even sales under present and proposed condeichs Portmann compary, operating at full capatity, sold 1,000,000 conits at a crico of s1s6 per unit during the current yes, Its income statement is as fallows: The divicion of coste betwen varibble and fored is as follows: Manygemant is considering a plant mpansion program for the follewino year that will permit an increase of s9.j00,090 in veurly cales. The expurwan will increase fixed costs by s4, 000, o0o but will varibic costs Required: 1. Detemmine the tocil varlable conts and the tocal fiaed wots for the cunmt year. Total variable costs fotal fixed coots 2. Determine (a) the unit yarlable cont and (b] the unit cantrituaien margin for the currest yeat. Unit variable cont: Ueit contribution magin 1 3. Cenipute the brejk even salen funed for the curnent voat. thits 4. Compute the break oven tates (usit) under the broponed progan for the folowing vear. ients 5. Detemmine the amount of sales (units) that would be necessary under the proposed program to realle the 561,400,000 of operating income that was earned in the current year. units 6. Determine the masimum operating income possible with the expanded plant. 7. It the propesal is accepted and sales remain at the curcent ievel, what will the operating incotne of loss be for the following vear? x 8. Eased on the data oiven, would you recommend accepting the proposal? a. In tavor of the preposal because of the reduction in breas even point. b. in tavor of the proposal because of the povibility of increasing iocome from eserabons. C. in tavor of the proposal because of the increase in treak-eyen podrt. d. Pelect the proposal because in foture sales remain at the current level, the income from operations will increase. 6. Malect the proposal becauis the sales necinccary to maintain the current income trom operations nould be below the current year sales. Choote the correct