Astro Co. sold 19,500 units of its only product and incurred a $45,700 loss (ignoring taxes) for the current year as shown here. During a planning session for year 2014's activities, the production manager notes that variable costs can be reduced 50% by installing a machine that automates several operations. To obtain these savings, the company must increase its annual fixed costs by $145,000. The maximum output capacity of the company is 40,000 units per year ASTRO COMPANY Contribution Margin Income Statement For Year Ended December 31, 2013 Sales Variable costs $ 721,500 577,200 Contribution margin Fixed costs 144,300 190,000 Net loss $ (45,700)