The Central Valley Company is a manufacturing firm that produces and sells a single product. The company's revenues and expenses for the last four months are given below. Sales in units Sales revenue Less: Cost of goods sold Gross margin Less: Operating expenses Shipping expense Advertising expense Salaries and commissions Insurance expense Amortization expense Total operating expenses Net income Central Valley Company Comparative Income Statement March 5,500 $ 726,000 April 5,000 $660,000 May 6,000 $ 792,000 356,400 $303,600 411,840 $380,160 384,250 $341,750 $ 62,500 77,500 162,300 11,500 44,500 $ 358,300 June 7,000 $ 924,000 471,240 $ 452,760 $ 55,000 $ 66,000 $ 68,500 77,500 140,500 11,500 44,500 $329,000 77,500 164,000 11,500 44,500 $363,500 77,500 178,000 11,500 44,500 $380,000 $ (16,550) $ (25,400) $ 16,660 $ 72,760 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.) Cost of goods sold Shipping $ 69,300 57.42 per unit $ 21,250+ $ 6.75 per unit Salaries & commission $ 46,750+ $ 18.75 per unit ences 2. Assume that fixed costs are incurred uniformly throughout the year. Compute the annual break-even sales, and the profit if 71,000 units are sold during the year. (Round "Break-even sales" answer to nearest whole number.) Break-even sales 8,739,756 units Annual profit (71,000 units) 3. Calculate the change in profit if the selling price were reduced by $6.50 each and annual sales were to increase by 6,000 units. ences 4. Determine the change in profit if the company were to increase advertising by $105,000 and if this were to increase sales by 6,000 units