Good evening,

PLEASE help answering number SIX. PLEASE write your answer legibly. The answer is NOT $446,483, 446,198 or 446,782. Thank you!

Determine the amount of sales (units) that would be necessary under

Break-Even Sales Under Present and Proposed Conditions

Johnson & Sons Inc., operating at full capacity, sold 101,250 units at a price of $129 per unit during the current year. Its income statement for the current year is as follows:

Sales			$13,061,250
Cost of goods sold			6,450,000
Gross profit			$6,611,250
Expenses:
Selling expenses	$3,225,000
Administrative expenses	3,225,000
Total expenses			6,450,000
Income from operations			$161,250

The division of costs between fixed and variable is as follows:

	Variable		Fixed
Cost of goods sold	70%		30%
Selling expenses	75%		25%
Administrative expenses	50%		50%

Management is considering a plant expansion program that will permit an increase of $1,161,000 in yearly sales. The expansion will increase fixed costs by $116,100, but will not affect the relationship between sales and variable costs.

Required:

1. Determine the total variable costs and the total fixed costs for the current year. Enter the final answers rounded to the nearest dollar.

Total variable costs	$
Total fixed costs	$

2. Determine (a) the unit variable cost and (b) the unit contribution margin for the current year. Enter the final answers rounded to two decimal places.

Unit variable cost	$
Unit contribution margin	$

3. Compute the break-even sales (units) for the current year. Enter the final answers rounded to the nearest whole number. units

4. Compute the break-even sales (units) under the proposed program for the following year. Enter the final answers rounded to the nearest whole number. units

5. Determine the amount of sales (units) that would be necessary under the proposed program to realize the $161,250 of income from operations that was earned in the current year. Enter the final answers rounded to the nearest whole number. units

6. Determine the maximum income from operations possible with the expanded plant. Enter the final answer rounded to the nearest dollar. $