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Astro Company sold 27,000 units of its only product and reported income of $190,300 for the current year. During a planning session for next year's
Astro Company sold 27,000 units of its only product and reported income of $190,300 for the current year. During a planning session for next year'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. Total units sold and the selling price per unit will not change. Problem 21-3A (Algo) Part 2 2. Prepare a contribution margin income statement for next year that shows the expected results with the machine installed. Assume sales are $1,485,000. Note: Do not round intermediate calculations. Round your answers to the nearest whole dollar. 3. Compute the sales level required in both dollars and units to earn $150,000 of target income for next year with the machine installed. Note: Do not round intermediate calculations. Round your answers to 2 decimal places. Round "Contribution margin ratio" to nearest whole percentage
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