Problem 6-22 (Algo) CVP Applications; Contribution Margin Ratio; Break-Even Analysis; Cost Structure [LO6-1, LO6-3, LO6-4, LO6-5, LO6-6] Due to enratic sales of ins sole product-a high-capacity battery for laptop computers. PEM incorporated, has been expenencing financial difficuity for some time. The company's contribution format income staternent for the most recent month is given beiow Required: 1 Compute the company's CM ratio and its break even point in unit sales and dollor soles: 2 The president believes that a $6,200 increase in the monthy advertising budget, combined with an intensified effort by the sales staft, wili increase unit sales and the total sales by $82,000 per momh. If the president is right, what will be the increase (decrease) in the company's monthly net operating income? 3. Refer to the onginal dats The sales manager is convinced that a tow reduction in the selling price, combined with an increase of $36,000 in the monthly advertising budget, wil double unit sales if the sales manajer is right, what will be the revised net operating ncome (0oss)? 4. Refer to the original data. The Marketing Department thinks that a fancy new package for the laptop computer bottery would grow sales The new package would increase packaging costs by 50 o per une. Assuming no other changes, how many units would have to be sold each month to attain a target profit of $4900 ? 5 . Refer to the original dota By autorating, the company could reduce variable expenses by 53 per unit. However, fixed expenses would increase by $59,000 each month a. Compute the new CM ratio and the new break-even point in unit sales and doltar sales b. Assume that the company expects to sel 20,800 units next month Prepare two contribution format income statements, one assuming that operations are not automated and one assuming that they ate. (Show data on a per unt and percentage bisis, as wedl as in total, for each alternative) c. Would you recommend that the company automate its operations (Assuming that the company expects to sel 20,800 units)? Complate this question by entering vour answers in the tabs betew. Compute the companris CM ratio and As break even point in unit sales and deltar sales. COo not round taternedite