The Northwest Catering Company specializes in preparing tasty meals that are frozen and shipped to various restaurants in the Seattle Area. Currently, the company offers two different meal options. More options are planned in the future. The company prepares the meals on a daily basis and ships them via truck to customers. The delivery cost is the same regardless of the number of units shipped . The companys bookkeeper prepared the following cost analysis:

	Product
	Smoked Salmon Pizza	Oyster and Octopus Pasta
Selling Price	$7.00	$9.00
Variable Cost	4.00	6.00
Estimated number of units sold	250,000	150,000
Sales Mix	62.5%	37.5%

Summary of Fixed Costs
Description	Amount
Truck Delivery Charges	125,800
Factory Rental	250,000
Depreciation on Equipment	150,000
Salaries for Factory Workers	240,000
Officer Salaries	300,000
Advertising	254,200

Required

1. Assuming that all units are sold, compute the company net income for the year.

2. Assuming that the sales mix remains constant, compute the breakeven point. Round the sales mix percentage to 4 decimal places. (ex. 10.1234)

3. The Oyster and Octopus Pasta has not been as popular as expected. However, the smoked salmon pizza has been a hit. During the current period, the company sold 99,000 Oyster and Octopus Pasta Meals and 297,000 Smoked Salmon Meals. Compute the net income based upon the actual unit sales.

4. These sales mix percentage relationships are expected to continue throughout the upcoming year. Based on the original information, compute the expected income for the upcoming year assuming the following changes will occur:

Total Fixed Costs will decrease by 5%

The variable cost per unit for each product will increase by 25%

The selling price per unit will increase by 20%

Total Unit Sales will increase by 5%