Required information [The following information applies to the questions displayed below.] Astro Company sold 23,000 units of its only product and reported income of $264,600 for the current year. During a planning session for next year's activities, the production manager notes that variable costs can be reduced 44% by installing a machine that automates several operations. To obtain these savings, the company must increase its annual fixed costs by $156,000. Total units sold and the selling price per unit will not change. ASTRO COMPANY Contribution Margin Income Statement For Year Ended December 31 Sales ($56 per unit) Variable costs ($35 per unit) Contribution margin Fixed costs Income $ 1,288,000 805,000 483,000 218,400 $ 264,600 2. Prepare a contribution margin income statement for next year that shows the expected results with the machine Installed. Assume sales are $1,288,000. (Do not round intermediate calculations. Round your answers to the near whole dollar.) ASTRO COMPANY Contribution Margin Income Statement For Year Ended December 31 Contribution margin 0 $ 0
Required information [The following information applies to the questions displayed below.] Astro Company sold 23,000 units of its only product and reported income of $264,600 for the current year. During a planning session for next year's activities, the production manager notes that variable costs can be reduced 44% by installing a machine that automates several operations. To obtain these savings, the company must increase its annual fixed costs by $156,000. Total units sold and the selling price per unit will not change. ASTRO COMPANY Contribution Margin Income Statement For Year Ended December 31 Sales ($56 per unit) Variable costs ($35 per unit) Contribution margin Fixed costs Income $ 1,288,000 805,000 483,000 218,400 $ 264,600 2. Prepare a contribution margin income statement for next year that shows the expected results with the machine Installed. Assume sales are $1,288,000. (Do not round intermediate calculations. Round your answers to the near whole dollar.) ASTRO COMPANY Contribution Margin Income Statement For Year Ended December 31 Contribution margin 0 $ 0
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
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![Required information
[The following information applies to the questions displayed below.]
Astro Company sold 23,000 units of its only product and reported income of $264,600 for the current
year. During a planning session for next year's activities, the production manager notes that variable
costs can be reduced 44% by installing a machine that automates several operations. To obtain these
savings, the company must increase its annual fixed costs by $156,000. Total units sold and the selling
price per unit will not change.
ASTRO COMPANY
Contribution Margin Income Statement
For Year Ended December 31
Sales ($56 per unit)
Variable costs ($35 per unit)
Contribution margin
Fixed costs
Income
$ 1,288,000
805,000
483,000
218,400
$ 264,600
2. Prepare a contribution margin income statement for next year that shows the expected results with the machine
installed. Assume sales are $1,288,000. (Do not round intermediate calculations. Round your answers to the nearest
whole dollar.)
ASTRO COMPANY
Contribution Margin Income Statement
For Year Ended December 31
Contribution margin
0
$
0](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F72aa5c36-5077-431e-a32a-805e2e329582%2F6cf6eaa3-f2d8-47b9-a460-d993db3f6904%2Fy0fxyvm_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Required information
[The following information applies to the questions displayed below.]
Astro Company sold 23,000 units of its only product and reported income of $264,600 for the current
year. During a planning session for next year's activities, the production manager notes that variable
costs can be reduced 44% by installing a machine that automates several operations. To obtain these
savings, the company must increase its annual fixed costs by $156,000. Total units sold and the selling
price per unit will not change.
ASTRO COMPANY
Contribution Margin Income Statement
For Year Ended December 31
Sales ($56 per unit)
Variable costs ($35 per unit)
Contribution margin
Fixed costs
Income
$ 1,288,000
805,000
483,000
218,400
$ 264,600
2. Prepare a contribution margin income statement for next year that shows the expected results with the machine
installed. Assume sales are $1,288,000. (Do not round intermediate calculations. Round your answers to the nearest
whole dollar.)
ASTRO COMPANY
Contribution Margin Income Statement
For Year Ended December 31
Contribution margin
0
$
0
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