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Astro Co. sold 20,200 units of its only product and incurred a $51,692 loss (ignoring taxes) for the current year as shown here. During
Astro Co. sold 20,200 units of its only product and incurred a $51,692 loss (ignoring taxes) for the current year as shown here. During a planning session for year 2018'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 $152,000. The maximum output capacity of the company is 40,000 units per year. ASTRO COMPANY Contribution Margin Income Statement Sales For Year Ended December 31, 2017 Variable costs Contribution margin Fixed costs Net loss $ 761,540 609,232 152,308 204,000 $ (51,692) K Problem 18-4A Part 2 2. Compute the predicted break-even point in dollar sales for year 2018 assuming the machine is installed and there is no change in the unit selling price. (Round your answers to 2 decimal places.)
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