Tanek Corp.s sales slumped badly in 2017. For the first time in its history, it operated at a loss. The companys income statement showed the following results from selling 555,500 units of product: sales $ 2,777,500 , total costs and expenses $ 2,888,600 , and net loss $ 111,100 . Costs and expenses consisted of the amounts shown below.

Total	Variable	Fixed
Cost of goods sold	$ 2,377,540	$ 1,766,490	$ 611,050
Selling expenses	277,750	102,212	175,538
Administrative expenses	233,310	75,548	157,762
$ 2,888,600	$ 1,944,250	$ 944,350

Management is considering the following independent alternatives for 2018.

1.	Increase unit selling price 25 % with no change in costs, expenses, and sales volume.
2.	Change the compensation of salespersons from fixed annual salaries totaling $ 166,650 to total salaries of $ 66,660 plus a 6 % commission on sales.

(a) Compute the break-even point in dollars for 2017. (Round final answer to 0 decimal places, e.g. 1,225.)

Break-even point

$

(b) Compute the contribution margin under each of the alternative courses of action. (Round final answer to 0 decimal places, e.g. 1,225.)

Contribution margin for alternative 1	%
Contribution margin for alternative 2	%

Compute the break-even point in dollars under each of the alternative courses of action. (Round selling price per unit to 2 decimal places, e.g. 5.25 and other calculations to 0 decimal places, e.g. 20% and also final answer to 0 decimal places, e.g. 1,225.)

Break-even point for alternative 1	$
Break-even point for alternative 2	$

Which course of action do you recommend?