Vice President for Sales and Marketing at Waterways Corporation is planning for production needs to meet sales demand in the coming year. He is also trying to determine how the company's profits might be increased in the coming year. This problem asks you to use cost$-$volume$-$profit concepts to help Waterways understand contribution margins of some of its products and decide whether to mass$-$produce any of them.

Waterways markets a simple water control and timer that it mass$-$produces. Last year, the company sold $720,000$ units at an average unit selling price of $$4\mathrm{.}70.$ The variable costs were $$2,030,400,$ and the fixed costs were $$879,840.$

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$($a$2)$

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$($a$5).$

$($b$1)$

Waterways is thinking of mass$-$producing one of its special$-$order sprinklers. To do so would increase unit variable costs for all sprinklers by an average of $$0\mathrm{.}70.$ The company also estimates that this change could increase the overall number of sprinklers sold by $10\%,$ and the average unit sales price would increase $$0\mathrm{.}20.$ Waterways currently sells $496,000$ sprinkler units at an average unit selling price of $$27,80.$ The manufacturing costs are $$7,654,360$ variable and $$1,991,155$ fixed. Selling and administrative costs are $$2,687,240$ variable and $$796,450$ fixed.

If Waterways begins mass$-$producing its special$-$order sprinklers, how would this affect the company? $($Round ratio answers to $0$ decimal places, e$.$g$.5\%$ and net income answers to $2$ decimal places, eg$.5,275\mathrm{.}25.)$