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5. Refer to the original data. By automating, the company could slash its variable expenses in half. However, fixed costs would increase by $86,500 per month. a. Compute the new CM ratio and the new break-even point in both units and dollars. (Do not round intermediate calculations. Round your "Contribution margin ratio" answer to 2 decimal places. Round your "Break-even point" answers up to nearest whole number.) Contribution margin ratio Break-even point in units Break-even point in dollars % b. Assume that the company expects to sell 27,000 units next month. Prepare two contribution format income statements: one assuming that operations are not automated, and one assuming that they are. (Do not round intermediate calculations. Round "Per
Add: Variable expenses Contribution margin Less: Fixed expenses Net operating loss $ $ 780,000 $ 585,000 195,000 $ 206,000 (11,000) 40.00 30.00 10.00 The point of indifference between the two options (20) 100.00 $ 1,080,000 $ 75.00 25.00 $ units Per tinit 810,000 270,000 $ 206,000 64,000 40.00 30.00 10.00 (%) c. This part of the question is not part of your Connect assignment. d. What is the point of indifference between the two options? (Do not round intermediate calculations. Round your answer up to nearest whole number.) 100.00 75.00 25.00