Your answer is correct. Pharoah has proposed a plan to get the partnership "out of the red" and improve its profitability. She feels that the quality of the product could be substantially improved by spending $0.25 more per unit on better raw materials. The selling price per unit could be increased to only $5.25 because of competitive pressures. Pharoah estimates that sales volume will increase by 25%. Compute the net income under Pharoah's proposal and the break-even point in dollars. (Round intermediate calculations to 4 decimal places, e.g. 15.2515 and final answers to 0 decimal places, e.g. 2,520.) Amount Net income 109375 Break-even point 1330234 LINK TO TEXT Your answer is partially correct. Try again. Paul was a marketing major in college. He believes that sales volume can be increased only by intensive advertising and promotional campaigns. He therefore proposed the following plan as an alternative to Pharoah's: (1) increase variable selling expenses to $0.59 per unit, (2) lower the selling price per unit by $0.25, and (3) increase fixed selling expenses by $50,000. Paul quoted an old marketing research report that said that sales volume would increase by 60% if these changes were made. Compute the net income under Paul's proposal and the break-even point in dollars. (Round intermediate calculations to 4 decimal places, e.g. 15.2515 and final answers to 0 decimal places, e.g. 2,520.) Amount Net income 53250 Break-even point 253378 Expand Your Critical Thinking 18-02 The condensed income statement for the Pharoah and Paul partnership for 2020 is as follows. Pharoah and Paul Company Income Statement For the Year Ended December 31, 2020 Sales (250,000 units) $1,250,000 Cost of goods sold 800,000 Gross profit 450,000 Operating expenses Selling $250,000 Administrative 206,250 456,250 Net loss $(6,250) A cost behavior analysis indicates that 75% of the cost of goods sold are variable, 42% of the selling expenses are variable, and 40% of the administrative expenses are variable. Your answer is correct. Compute the break-even point in total sales dollars for 2020. (Round intermediate calculations to 2 decimal places, e.g. 15.25 and final answers to 0 decimal places, e.g. 2,520.) Break-even point in dollars 1266890 LINK TO TEXT