Booth company had sales in 2020.

Booth Company had sales in 2020 of $1.715,000 on 68.600 units. Variable costs totaled $1.029,000 and foxed costs totaled $479,000 A new raw material is available that will decrease the variable costs per unit by 20% (or $3.00). However, to process the new raw material, fixed operating costs will increase by $116,000. Management feels that two-thirds of the decline in the variable costs per unit should be passed on to customers in the form of a sales price reduction. The marketing department expects that this sales price reduction will result in a 4% increase in the number of units sold. (a 1) Your answer is correct. Prepare a projected CVP income statement for 2020 assuming the changes have not been made. Booth Company CVP Income Statement For the Year Ended December 31, 2020 Sales 1715000 Variable Costs 1029000 i Contribution Margin 686000 Less VE Fixed Costs 479000 Net Income (Loss) 207000 Your answer is partially correct. Prepare a projected CVP income statement for 2020 assuming that changes are made as described. Booth Company CVP Income Statement For the Year Ended December 31, 2020 Sales $ 2040000 Cost of Goods Sold