Required: 1. Determine the total variable costs and the total xed costs for the current year. Total variable costs C Total xed costs C 2. Determine (a) the unit variable cost and (b) the unit contribution margin for the current year. Unit variable cost G Unit contribution margin 3. Compute the breakeven sales (units) for the current year. 4. Compute the breakieven sales (units) under the proposed program for the following year. > 1:] 5. Determine the amount of sales (units) that would be necessary under the proposed program to realize the $59,500,000 of operating income that was earned in the current year. 6. Determine the maximum operating income possible with the expanded plant. C 7. If the proposal is accepted and sales remain at the current level, what will the operating income or loss be for the following year? 4:] ._. Break-Even Sales Under Present and Proposed Conditions Portmann Company, operating at full capacity, sold 1,000,000 units at a price of $188 per unit during the current year. Its income statement is as follows: Sales $188,000,000 Cost of goods sold (100,000,000) Gross profit $88,000,000 Expenses: Selling expenses $15,000,000 Administrative expenses 13,500,000 Total expenses (28,500,000) Operating income $59,500,000 The division of costs between variable and fixed is as follows: Variable Fixed Cost of goods sold 70% 30% Selling expenses 75% 25% Administrative 50% 50% expenses Management is considering a plant expansion program for the following year that will permit an increase of $13,160,000 in yearly sales. The expansion will increase fixed costs by $4,000,000 but will not affect the relationship between sales and variable costs