Astro Company sold 25,000 units of its only product and reported income of $117,600 for the current year. During a planning session for next year's activities, the production manager notes that variable costs can be reduced 40% by installing a machine that automates several operations. To obtain these savings, the company must increase its annu- fixed costs by $149,000. Total units sold and the selling price per unit will not change. ASTRO COMPANY Contribution Margin Income Statement For Year Ended December 31 Sales ($40 per unit) Variable costs ($32 per unit) Contribution margin $ 1,000,000 800,000 200,000 82,400 $ 117,600 Fixed costs Income Compute the break-even point in dollar sales for next year assuming the machine is installed. (Round your answers to 2 d aces.) Answer is complete but not entirely correct. Contribution Margin per Proposed unit Sales 40.00 Per unit Variable costs 12.80 Per unit Contribution margin 27.20 Per unit
Astro Company sold 25,000 units of its only product and reported income of $117,600 for the current year. During a planning session for next year's activities, the production manager notes that variable costs can be reduced 40% by installing a machine that automates several operations. To obtain these savings, the company must increase its annu- fixed costs by $149,000. Total units sold and the selling price per unit will not change. ASTRO COMPANY Contribution Margin Income Statement For Year Ended December 31 Sales ($40 per unit) Variable costs ($32 per unit) Contribution margin $ 1,000,000 800,000 200,000 82,400 $ 117,600 Fixed costs Income Compute the break-even point in dollar sales for next year assuming the machine is installed. (Round your answers to 2 d aces.) Answer is complete but not entirely correct. Contribution Margin per Proposed unit Sales 40.00 Per unit Variable costs 12.80 Per unit Contribution margin 27.20 Per unit
Chapter3: Cost-volume-profit Analysis
Section: Chapter Questions
Problem 5EA: Maple Enterprises sells a single product with a selling price of $75 and variable costs per unit of...
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How do I find my variable cost? Please answer competely
![Astro Company sold 25,000 units of its only product and reported income of $117,600 for the current year. During a
planning session for next year's activities, the production manager notes that variable costs can be reduced 40% by
installing a machine that automates several operations. To obtain these savings, the company must increase its annue
fixed costs by $149,000. Total units sold and the selling price per unit will not change.
ASTRO COMPANY
Contribution Margin Income Statement
For Year Ended December 31
Sales ($40 per unit)
Variable costs ($32 per unit)
Contribution margin
Fixed costs
$ 1,000,000
800,000
200,000
82,400
$ 117,600
Income
1. Compute the break-even point in dollar sales for next year assuming the machine is installed. (Round your answers to 2 de
places.)
Answer is complete but not entirely correct.
Contribution Margin per
unit
Proposed
Sales
40.00
Per unit
Variable costs
12.80
Per unit
Contribution margin
27.20
Per unit
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6
7.
of 10
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Transcribed Image Text:Astro Company sold 25,000 units of its only product and reported income of $117,600 for the current year. During a
planning session for next year's activities, the production manager notes that variable costs can be reduced 40% by
installing a machine that automates several operations. To obtain these savings, the company must increase its annue
fixed costs by $149,000. Total units sold and the selling price per unit will not change.
ASTRO COMPANY
Contribution Margin Income Statement
For Year Ended December 31
Sales ($40 per unit)
Variable costs ($32 per unit)
Contribution margin
Fixed costs
$ 1,000,000
800,000
200,000
82,400
$ 117,600
Income
1. Compute the break-even point in dollar sales for next year assuming the machine is installed. (Round your answers to 2 de
places.)
Answer is complete but not entirely correct.
Contribution Margin per
unit
Proposed
Sales
40.00
Per unit
Variable costs
12.80
Per unit
Contribution margin
27.20
Per unit
< Prev
5.
6
7.
of 10
Next>
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