cercise (Video) Carey Company had sales in 2019 of $1,806,000 on 64,500 units. Variable costs totaled $1,032,000, and fixed costs totaled $508,000. new raw material is available that will decrease the variable costs per unit by 20% (or $3.20). However, to process the new raw material, fixed operating costs will increase by $107,000. Management feels that one-half of the decline in the variable costs per unit she assed on to customers in the form of a sales price reduction. The marketing department expects that this sales price reduction will result in a 5% increase in the number of units sold. (a) Prepare a projected CVP income statement for 2020, assuming the changes have not been made. CAREY COMPANY CVP Income Statement Total CAREY COMPANY CVP Income Statement S b) Prepare a projected CVP income statement for 2020, assuming that changes are made as described. (Round per unit cost to 2 decimal places, e.g. 5.25 and all other answers to 0 decimal places, e.g. 1,225.) $ Total Per Unit Per Unit
cercise (Video) Carey Company had sales in 2019 of $1,806,000 on 64,500 units. Variable costs totaled $1,032,000, and fixed costs totaled $508,000. new raw material is available that will decrease the variable costs per unit by 20% (or $3.20). However, to process the new raw material, fixed operating costs will increase by $107,000. Management feels that one-half of the decline in the variable costs per unit she assed on to customers in the form of a sales price reduction. The marketing department expects that this sales price reduction will result in a 5% increase in the number of units sold. (a) Prepare a projected CVP income statement for 2020, assuming the changes have not been made. CAREY COMPANY CVP Income Statement Total CAREY COMPANY CVP Income Statement S b) Prepare a projected CVP income statement for 2020, assuming that changes are made as described. (Round per unit cost to 2 decimal places, e.g. 5.25 and all other answers to 0 decimal places, e.g. 1,225.) $ Total Per Unit Per Unit
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Exercise 6-5 (Video)
Carey Company had sales in 2019 of $1,806,000 on 64,500 units. Variable costs totaled $1,032,000, and fixed costs totaled $508,000.
A new raw material is available that will decrease the variable costs per unit by 20 % (or $3.20). However, to process the new raw material, fixed operating costs will increase by $107,000. Management feels that one-half of the decline in the variable costs per unit should be
passed on to customers in the form of a sales price reduction. The marketing department expects that this sales price reduction will result in a 5% increase in the number of units sold.
(a) Prepare a projected CVP income statement for 2020, assuming the changes have not been made.
CAREY COMPANY
CVP Income Statement
v
Total
>>>>>
(b) Prepare a projected CVP income statement for 2020, assuming that changes are made as described. (Round per unit cost to 2 decimal places, e.g. 5.25 and all other answers to 0 decimal places, e.g. 1,225.)
CAREY COMPANY
CVP Income Statement
Per Unit
Total
Per Unit
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