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1. Compute break-even point in units. 2. Compute break-even point in sales dollars.

1. Compute break-even point in units. 2. Compute break-even point in sales dollars.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Required information [The following information applies to the questions displayed below.] Hudson Company reports the following contribution margin income statement. HUDSON COMPANY Contribution Margin Income Statement For Year Ended December 31 Sales (11,200 units at $280 each). Variable costs (11,200 units at $210 each) Contribution margin Fixed costs Income 1. Compute break-even point in units. 2. Compute break-even point in sales dollars. 1. Break-even units 2. Break-even sales dollars units $ 3,136,000 2,352,000 784,000 567,000 $ 217,000
Transcribed Image Text:Required information [The following information applies to the questions displayed below.] Hudson Company reports the following contribution margin income statement. HUDSON COMPANY Contribution Margin Income Statement For Year Ended December 31 Sales (11,200 units at $280 each). Variable costs (11,200 units at $210 each) Contribution margin Fixed costs Income 1. Compute break-even point in units. 2. Compute break-even point in sales dollars. 1. Break-even units 2. Break-even sales dollars units $ 3,136,000 2,352,000 784,000 567,000 $ 217,000
Required information [The following information applies to the questions displayed below.] Hudson Company reports the following contribution margin income statement. Sales (11,200 units at $280 each) Variable costs (11,200 units at $210 each) Contribution margin Fixed costs Income HUDSON COMPANY Contribution Margin Income Statement. For Year Ended December 31 1. Amount of sales 2. Margin of safety $ 3,136,000 2,352,000 1. Assume Hudson has a target income of $156,000. What amount of sales (in dollars) is needed to produce this target income? 2. If Hudson achieves its target income, what is its margin of safety (in percent)? (Round your answer to 1 decimal place.) % 784,000 567,000 $ 217,000
Transcribed Image Text:Required information [The following information applies to the questions displayed below.] Hudson Company reports the following contribution margin income statement. Sales (11,200 units at $280 each) Variable costs (11,200 units at $210 each) Contribution margin Fixed costs Income HUDSON COMPANY Contribution Margin Income Statement. For Year Ended December 31 1. Amount of sales 2. Margin of safety $ 3,136,000 2,352,000 1. Assume Hudson has a target income of $156,000. What amount of sales (in dollars) is needed to produce this target income? 2. If Hudson achieves its target income, what is its margin of safety (in percent)? (Round your answer to 1 decimal place.) % 784,000 567,000 $ 217,000
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