Assignment (CVP) Suria Sdn. Bhd. produces a molded plastic casing. KLX06. ford X06, for desktop computers. Summary data from its 2018 statement of profit or loss is as follows: RM Revenues Less: Cost of goods sold Gross profit Less: Selling and admin expenses Operating income 4,000,000 (3,000,000) 1,000,000 (1,128,000) (128,000) The cost of goods sold consist of RM2,000,000 variable manufacturing cost and RM1,000,000 fixed manufacturing cost. Only RM400,000 of the selling and administration expenses are variable, the rest are fixed expenses. Puan Mariam, Suria's president is very concerned about Suria's poor profitability. She asks Encik Hakim, the production manager and Encik Ahmad, the controller, to see if there are ways to reduce costs. After 2 weeks, Encik Hakim returns with proposal to reduce variable costs to 52% of revenues by reducing the costs Suria currently incurs for safe disposal of wasted plastic. Encik Ahmad is concerned that this would expose the company to potential environmental liabilities. He tells Hakim, "We would need to estimate some of those potential environmental costs an that in our analysis.". "You can't do that," Hakim replies. "We are not violating any laws. There is some possibility that we may have to incur environmental costs in the future, but if we bring it up now, this proposal will not go through because our senior management always assumes these costs to be larger than they turn out to be. The market is very tough, and we are in danger of utting down the company and costing all of us our jobs. The only reason our competitors are making money is because they are doing exactly what I am proposing. Required al. Using contribution margin ratio method, determine Suria's breakeven revenues for 2018, in ringgit sales. (6 marks) b. Calculate Suria's breakeven rev comment on the result by comparing to your result in (a) above. Suria's breakeven revenue if variable costs are 52% of revenues. Briefly (4 marks) c. Calculate Suria's operating income for 2018 if variable costs had been 52% of revenues. (3 marks) d. Given Encik Hakim's comments, what should Encik Ahmad do? (3 marks) e. Briefly discuss the two benefits of cost volume profit analysis for business owner. (4 marks) [Total: 20 marks)