Exercise 3-13A Conducting sensitivity analysis using the equation method LO 3-5 Adams Company currently produces and sells 8,300 units annually of a product that has a variable cost of $13 per unit and annual fixed costs of $316,400. The company currently earns a $82,000 annual profit. Assume that Adams has the opportunity to invest in new labor-saving production equipment that will enable the company to reduce variable costs to $11 per unit. The investment would cause fixed costs to increase by $9,300 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 Adams invests in the new production equipment. Complete this question by entering your answers in the tabs b RequiredA Required B Prepare a contribution margin income statement, assuming that Adams invests in the new production equipment. ADAMS COMPANY Contribution margin Income statement Required A Required B