Problem 4-27 Changes in Cost Structure; Break-Even Analysis; Operating Leverage; Margin of Safety [LO4, LO5, LO6, LO7, LO8] Frieden Company's contribution format income statement for last month is shown below: Sales (40,000 units) Variable expenses Contribution margin Fixed expenses Operating income $1,200,000 720,000 480,000 432,000 $ 48,000 Competition is intense, and Frieden Company's profits vary considerably from one year to the next. Management is exploring opportunities to increase profitability. Required: 1. Frieden's management is considering a major upgrade to the manufacturing equipment, which would result in fixed expenses increasing by $480,000 per month. However, variable expenses would decrease by $12 per unit. Selling price would not change. Prepare two contribution format income statements, one showing current operations and one showing how operations would appear if the upgrade is completed. Show an Amount column, a Per Unit column, and a Percentage column on each statement. $ FRIEDEN COMPANY Contribution Margin Income Statement Amount Present Per Unit % Amount Proposed Per Unit % 0 $ 0 0 0 $ 0 0 0 $ 0