The Central Valley Company is a manufacturing firm that produces and sells a single product. The companys revenues and expenses for the last four months are given below.

Central Valley Company Comparative Income Statement
	March			April				May			June
Sales in units		5,900			5,400			6,600			7,800
Sales revenue	$	743,400		$	680,400		$	831,600		$	982,800
Less: Cost of goods sold		394,850			367,416			432,432			501,228
Gross margin	$	348,550		$	312,984		$	399,168		$	481,572
Less: Operating expenses
Shipping expense	$	63,300		$	54,200		$	66,800		$	66,500
Advertising expense		83,500			83,500			83,500			83,500
Salaries and commissions		163,500			138,500			166,000			176,000
Insurance expense		13,500			13,500			13,500			13,500
Amortization expense		46,500			46,500			46,500			46,500
Total operating expenses	$	370,300		$	336,200		$	376,300		$	386,000
Net income	$	(21,750	)	$	(23,216	)	$	22,868		$	95,572

Required:

1. Management is concerned about the losses experienced during the spring and would like to know more about the cost behaviour. Develop a cost equation for each of the costs. (Do not round intermediate calculations. Round "Per Unit" answers to 2 decimal places.)

2. Assume that fixed costs are incurred uniformly throughout the year. Compute the annual break-even sales, and the profit if 75,000 units are sold during the year. (Round "Break-even sales" answer to nearest whole number.)

3. Calculate the change in profit if the selling price were reduced by $8.50 each and annual sales were to increase by 6,800 units.

4. Determine the change in profit if the company were to increase advertising by $109,000 and if this were to increase sales by 6,800 units.