1. Assume Hudson Co. has a target pretax income of $172,000 for 2020. What amount of sales (in dollars) is needed to produce this target income? 2. If Hudson achieves its target pretax income for 2020, what is its margin of safety (in percent)? (Round your answer to 1 decimal place.)
1. Assume Hudson Co. has a target pretax income of $172,000 for 2020. What amount of sales (in dollars) is needed to produce this target income? 2. If Hudson achieves its target pretax income for 2020, what is its margin of safety (in percent)? (Round your answer to 1 decimal place.)
Chapter2: Building Blocks Of Managerial Accounting
Section: Chapter Questions
Problem 9EA: The cost data for Evencoat Paint for the year 2019 is as follows: Using the high-low method, express...
Related questions
Question
![Required information
[The following information applies to the questions displayed below.]
Hudson Co. reports the contribution margin income statement for 2019.
HUDSON Co.
Contribution Margin Income Statement
For Year Ended December 31, 2019
Sales (10,600 units at $300 each)
Variable costs (10,600 units at $240 each)
Contribution margin
$3,180,000
2,544,000
636,000
480,000
Fixed costs
Pretax income
156,000
1. Assume Hudson Co. has a target pretax income of $172,000 for 2020. What amount of sales (in dollars) is needed to produce this
target income?
2. If Hudson achieves its target pretax income for 2020, what is its margin of safety (in percent)? (Round your answer to 1 decimal
place.)
1. Amount of sales
2.
Margin of safety](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F17e8d1d7-0817-4afa-b1d8-2cbedcad66ee%2Fdc41ee8f-0d2a-4199-9244-1b2282856192%2F4ffdx0g_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Required information
[The following information applies to the questions displayed below.]
Hudson Co. reports the contribution margin income statement for 2019.
HUDSON Co.
Contribution Margin Income Statement
For Year Ended December 31, 2019
Sales (10,600 units at $300 each)
Variable costs (10,600 units at $240 each)
Contribution margin
$3,180,000
2,544,000
636,000
480,000
Fixed costs
Pretax income
156,000
1. Assume Hudson Co. has a target pretax income of $172,000 for 2020. What amount of sales (in dollars) is needed to produce this
target income?
2. If Hudson achieves its target pretax income for 2020, what is its margin of safety (in percent)? (Round your answer to 1 decimal
place.)
1. Amount of sales
2.
Margin of safety
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
![Cornerstones of Cost Management (Cornerstones Ser…](https://www.bartleby.com/isbn_cover_images/9781305970663/9781305970663_smallCoverImage.gif)
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning
Principles of Accounting Volume 2
Accounting
ISBN:
9781947172609
Author:
OpenStax
Publisher:
OpenStax College
![Cornerstones of Cost Management (Cornerstones Ser…](https://www.bartleby.com/isbn_cover_images/9781305970663/9781305970663_smallCoverImage.gif)
Cornerstones of Cost Management (Cornerstones Ser…
Accounting
ISBN:
9781305970663
Author:
Don R. Hansen, Maryanne M. Mowen
Publisher:
Cengage Learning