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Hudson Company reports the following contribution margin income statement. HUDSON COMPANY Contribution Margin Income Statement For Year Ended December 31 Sales (11,500 units at $225 each) Variable costs (11,500 units at $180 each) Contribution margin Fixed costs Income $ 2,587,500 2,070,000 517,500 360,000 $ 157,500

Hudson Company reports the following contribution margin income statement. HUDSON COMPANY Contribution Margin Income Statement For Year Ended December 31 Sales (11,500 units at $225 each) Variable costs (11,500 units at $180 each) Contribution margin Fixed costs Income $ 2,587,500 2,070,000 517,500 360,000 $ 157,500

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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es ! 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 (11,500 units at $225 each) Variable costs (11,500 units at $180 each) Contribution margin Fixed costs Income 1. Dollar sales for target income 2. Margin of safety $ 2,587,500 2,070,000 1. Assume Hudson has a target income of $154,000. 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)? Note: Round your answer to 1 decimal place. % 517,500 360,000 $ 157,500
Transcribed Image Text:es ! 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 (11,500 units at $225 each) Variable costs (11,500 units at $180 each) Contribution margin Fixed costs Income 1. Dollar sales for target income 2. Margin of safety $ 2,587,500 2,070,000 1. Assume Hudson has a target income of $154,000. 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)? Note: Round your answer to 1 decimal place. % 517,500 360,000 $ 157,500
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