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Blanchard Company manufactures a single product that sells for $110 per unit and whose total variable costs are $88 per unit. The company's annual fixed
Blanchard Company manufactures a single product that sells for $110 per unit and whose total variable costs are $88 per unit. The company's annual fixed costs are $620,000. The sales manager predicts that annual sales of the company's product will soon reach 39,000 units and its price will increase to $190 per unit. According to the production manager, variable costs are expected to increase to $130 per unit, but fixed costs will remain at $620,000. The income tax rate is 20%. What amounts of pretax and after-tax income can the company expect to earn from these predicted changes? Prepare a forecasted contribution margin income statement. BLANCHARD COMPANY Forecasted Contribution Margin Income Statement Units $ per unit Contribution margin rgin $ 0
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