QUESTION 3 Mengabang Sdn. Bhd. sold 20,000 units of its only product and incurred a RM50,000 loss (ignoring taxes) for the current year as shown below. During a planning session for year 2018's activities, the production manager notes that the variable costs can be reduced by 50%% by installing a machine that automates several operations. To obtain these savings, the company must increase its annual fixed costs by RM150,000. The maximum output capacity of the company is 40,000 units per year. Mengabang Son. Bhd. Contribution Margin Income Statement For Year Ended 31 December 2017 RM Sales 750,000 Variable costs 600.000Contribution Margin 150,000 Fixed costs 200,000 Net loss (50,000) Required: a. Compute the break-even point in RM for year 2017 (4 marks) b. Compute the predicted break-even point in RM for year 2018 assuming the machine is installed and there is no change in the sales price per unit. (5 marks) c. Prepare a forecasted contribution margin income statement for 2018 that shows the expected results with the machine installed. Assume that the sales price per unit and the number of units sold will not change, and no income taxes will be due. (5 marks) d. Compute the sales level required (in both RM and units) to earn RM140,000 of after-tax income in 2018 with the machine installed and no change in the unit sales price. Assume that the income tax rate is 309%. (6 marks) e. Prepare a forcasted contribution margin income statement that shows the results at the sales level computed in part (d). Assume the income tax rate of 30%. (7 marks)