2. Prepares forecasted contratto income statement with columns showing the expected results of plan 1 and plan 2 The statements should report sales, total variable costs contribution margintotal fixed costs income before taxes, Income taxes (30% net income

NEED HELP ON INCOME TAX

Required information The following information applies to the questions displayed below.) This year Burchard Company sold 33,000 units of its only product for $18.40 per unit Manufacturing and selling the product required $118,000 of fixed manufacturing costs and $178,000 of fixed selling and administrative costs. Its per unit variable costs follow Direct labor (paid on the basis of completed units) Variable Overhead costs Variable selling and administrative costs $ 3.80 2.80 0.38 0.18 Next year the company will use a new material, which will reduce material costs by 60% and direct labor costs by 40% and will not affect product quality or marketability Management is considering an increase in the unit selling price to reduce the number of units sold because the factory's output is nearing its annual output capacity of 38,000 units. TWO plans are being considered. Under plan 1, the company will keep the selling price at the current level and sell the same volume as last year. This plan will increase income because of the reduced costs from using the new material. Under plan 2, the company will increase the selling price by 25%. This plan will decrease unit sales volume by 10%. Under both plans, the total fixed costs and the variable costs per unit for overhead and for selling and administrative costs will remain the same. 2. Prepare a forecasted contribution margin income statement with two columns showing the expected results of plan 1 and plan 2 The statements should report sales, total variable costs, contribution margin, total fixed costs, income before taxes, income taxes (30% rate), and net income, 2. Prepare a forecasted contribution margin income statement with two columns showing the expected results of plan 1 an The statements should report sales, total variable costs, contribution margin, total fixed cos rate), and net income. Answer is not complete. BURCHARD CO. Forecasted Contribution Margin Income Statement Plan 1 Plan 2 Number of units: 33,000 29,700 Sales Variable costs Contribution margin Fixed costs Income before taxes Income taxes $ 607.200 124,080 483,120 296,000 187,120 118,000 $ 69,120 $ 683,100 111,672 571,428 296,000 275,428 Net Income (loss) $ 275,428 Required information The following information applies to the questions displayed below.] This year Burchard Company sold 33,000 units of its only product for $18.40 per unit. Manufacturing and selling the product required $118,000 of fixed manufacturing costs and $178,000 of fixed selling and administrative costs. Its per unit variable costs follow Material Direct labor (paid on the basis of completed units) Variable overhead costs Variable selling and administrative costs $ 3.80 2.80 0.38 0.18 Next year the company will use a new material, which will reduce material costs by 60% and direct labor costs by 40% and will not affect product quality or marketability Management is considering an increase in the unit selling price to reduce the number of units sold because the factory's output is nearing its annual output capacity of 38.000 units. Two plans are being considered. Under plan 1, the company will keep the selling price at the current level and sell the same volume as last year. This plan will increase income because of the reduced costs from using the new material Under plan 2. the company will increase the selling price by 25%. This plan will decrease unit sales volume by 10%. Under both plans, the total fixed costs and the variable costs per unit for overhead and for selling and administrative costs will remain the same Answer is complete and correct. Per unit: Plan 1 Sales Plan 2 $ 23,00 18.40 Variable Costs: Material Direct labor Variable overhead costs Variable S&A costs Total variable costs Contribution margin 1.52 1.68 0.38 0.18 3.76 1.52 1.68 0.38 0.18 3.76 14,64 19.24 Plan + Choose Denominator: Contribution Margin Ratio Contribution Margin Ratio Choose Numerator: Contribution margin per unit 14.641 Break.Even Point in Dollars Choose Numerator: Sales per unit $ Contribution margin ratio 79.57% 18.40 - Dollars Total fixed costs Choose Denominator: Contribution margin ratio - Break-Even Point in Break-even point in dollars Break-even prou . Required information Plan 1 Contribution Margin Ratio Choose Numerator: Contribution margin per in per unit 14.64 Break-Even Point in Dollars Choose Numerator: Choose Denominator: Sales per unit $ 18.40 - - - Contribution Margin Ratio Contribution margin ratio 79.57% Break-Even Point in Dollars Total fixed costs Choose Denominator: Contribution margin ratio 79.57% Plan 2 Break-even point in dollars 371,999 296,000 = Sales per unit Contribution Margin Ratio Contribution margin per unit 19.24 Break-Even Point in Dollars Total fixed costs 296,000 Contribution margin ratio 83.65% 23.00 Contribution margin ratio 83.65% Break-even point in dollars $ 353,855 =