Connelly Inc., a manufacturer of quality electric ice cream makers, has experienced a steady growth in sales over the past few years. Because her business has grown, Jan DeJaney, the president, believes she needs an aggressive advertising campaign next year to maintain the companys growth. To prepare for the growth, the accountant prepared the following data for the current year:

Variable costs per ice cream maker
Direct labor	$	13.50
Direct materials		14.50
Variable overhead		6.00
Total variable costs	$	34.00
Fixed costs
Manufacturing	$	82,500
Selling		42,000
Administrative		356,000
Total fixed costs	$	480,500
Selling price per unit	$	67.00
Expected sales (units)		30,000

Required:

1. If the costs and sales price remain the same, what is the projected operating profit for the coming year? ***509,500 CORRECT

2. What is the breakeven point in units for the coming year? ***14,561 CORRECT

3. Jan has set the sales target for 35,000 ice cream makers, which she thinks she can achieve by an additional fixed selling expense of $200,000 for advertising. All other costs remain as per the data in the above table. What will be the operating profit if the additional $200,000 is spent on advertising and sales rise to 35,000 units? ***474,500 CORRECT

4-a. What will be the new breakeven point if the additional $200,000 is spent on advertising? **20,621 CORRECT

4-b. Prepare a contribution income statement at the new breakeven point. ONLY NEED HELP WITH THIS PART! SALES REV AND VARIABLE COSTS. Those 2 are wrong.

CONNELLY, INC.
Contribution Income Statement
Sales revenue selected answer correct		$1,381,607selected answer incorrect
Less: Variable costs selected answer correct		701,114selected answer incorrect
Contribution margin selected answer correct		$680,493
Less: Fixed costs selected answer correct
Original amount	$480,500selected answer correct
Incremental amount	200,000selected answer correct
		$680,500
Operating profits elected answer correct		$(7)