# Problem 6.43A a-b Gorham Manufacturing’s sales slumped badly in 2020. For the first time in its

Problem 6.43A a-b Gorham Manufacturing&#39;s sales slumped badly in 2020. For the first time in its history, it operated at a loss. The company&#39;s income statement showed the following results from selling 57,000 units of product: net sales \$1,824,000; total costs and expenses \$2,028,288; and net loss \$204,288. Costs and expenses consisted of the amounts shown below: Cost of goods sold Selling expenses Administrative expenses Total \$1,361,288 485,000 182,000 \$2,028,288 Variable \$987,320 136,000 117,000 \$1,240,320 Fixed \$373,968 349,000 65,000 \$787,968 Management is considering the following independent alternatives for 2021. 1. Increase the unit selling price by 25% with no change in costs, expenses, or sales volume. 2. Change the compensation of salespersons from fixed annual salaries totalling \$205,000 to total salaries of \$18,000 plus a 5% commission on net sales. 3. Purchase new high-tech factory machinery that will change the proportion between variable and fixed cost of goods sold to 50:50. Calculate the break-even point in dollars for 2020. Break-even points Calculate the break-even point in dollars under each of the alternative courses of action. (Round contribution margin ratio to 2 decimal places, e.g. 15.25% and final answers to o decimal places, e.g. 5,275.) Break-even point if unit selling price increases by 25% Break-even point if there is a change in compensation Break-even point if there is a purchase of new high-tech factory machinery \$