Exercise 3-13A (Algo) Conducting sensitivity analysis using the equation method LO 3-5 Rooney Company currently produces and sells 7,700 units annually of a product that has a variable cost of $15 per unit and annual fixed costs of $284,200. The company currently earns a $70,000 annual profit. Assume that Rooney has the opportunity to invest in new labor-saving production equipment that will enable the company to reduce variable costs to $13 per unit. The investment would cause fixed costs to increase by $9,500 because of additional depreciation cost. Required a. Use the equation method to determine the sales price per unit under existing conditions (current equipment is used). b. Prepare a contribution margin income statement, assuming that Rooney invests in the new production equipment. Complete this question by entering your answers in the tabs below. Required A Required B Use the equation method to determine the sales price per unit under existing conditions (current equipment is used). Sales price per unit Exercise 3-13A (Algo) Conducting sensitivity analysis using the equation method LO 3-5 Rooney Company currently produces and sells 7,700 units annually of a product that has a variable cost of $15 per unit and annual fixed costs of $284,200. The company currently earns a $70,000 annual profit. Assume that Rooney has the opportunity to invest in new labor-saving production equipment that will enable the company to reduce variable costs to $13 per unit. The investment woule cause fixed costs to increase by $9,500 because of additional depreciation cost. Required a. Use the equation method to determine the sales price per unit under existing conditions (current equipment is used). b. Prepare a contribution margin income statement, assuming that Rooney invests in the new production equipment. Complete this question by entering your answers in the tabs below. Required A Required B Prepare a contribution margin income statement, assuming that Rooney Invests in the new production equipment. ROONEY COMPANY Contribution margin Income statement