Complete the following contribution margin income statement to properly reflect the break-even information given in the problem. Rounded to whole dollars and shown with "$" and commas as needed (i.e. $12,345).
3. Flanders Manufacturing is considering purchasing a new machine that will reduce variable costs per part produced by $0.15. The machine will increase fixed costs by $18,250 per year. The information they will use to consider these changes is shown here.
Current
Units sold 216,000
Sales price per unit $2.15
Variable cost per unit $1.75
Contribution margin per unit $0.40
Fixed costs $56,000
Break-even(in unit) $140,000
Break-even(in dollars) $301,000
Sales $464,400
Variable costs $378,000
Contribution margin $86,400
Fixed costs $56,000
Net Income (loss) $30,400
The following names are to be considered when completing this problem:
| Operating Income | Variable Costs |
Sales |
| Fixed Costs per Unit | Selling Price per Unit |
Variable Cost per Unit |
| Contribution Margin | Fixed Costs |
Operating Loss |
- If Flanders purchases the new machinery, what will be the company’s break-even point in units? .
- Use commas as needed (i.e. 1,234).
- If Flanders purchases the new machinery, what will be the company’s break-even point in dollars? .
- Rounded to whole dollars and shown with "$" and commas as needed (i.e. $12,345).
- Assuming Flanders purchases the new machinery, construct a contribution margin income statement for sale of 216,000 units. Rounded to whole dollars and shown with "$" and commas as needed (i.e. $12,345).
Flanders Manufacturing
Contribution Margin Income Statement
For the Month
- Complete the following contribution margin income statement to properly reflect the break-even information given in the problem. Rounded to whole dollars and shown with "$" and commas as needed (i.e. $12,345).
Flanders Manufacturing
Contribution Margin Income Statement
For the Month
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