Shelly's Boutiques and Crafts had revenue of $6,300,000 this year on sales of 475,000 units. Variable costs were 55% of sales and fixed costs totaled $2,250,000. Although the first five years were relatively profitable, increases in competition have led to a negative trend in profitability that has led them to the point where they have to make some changes to stay afloat. The company is evaluating two options to stay afloat. Option 1: Purchase machinery to automate their operations. This machinery costs $450,000 (an increase in fixed cost), but will decrease variable costs down from the original 55% to 40% of sales. Option 2: Outsource the production of one of their main components that requires a substantial amount of machinery and skilled labor. This will reduce fixed costs by $375,000, but increases variable costs from their current 55% of sales to 65% of sales. Use the original data, with no data from option 1 and 2 applied for questions a-c a.) Determine the break even point in units (before any changes) What is the fixed cost in total? What is the contribution margin per unit? What is the break even point in units? 3