Connelly Incorporated, 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	$ 10.00
Direct materials	12.00
Variable overhead	5.00
Total variable costs	$ 27.00
Fixed costs
Manufacturing	$ 118,000
Selling	58,000
Administrative	512,000
Total fixed costs	$ 688,000
Selling price per unit	$ 50
Expected sales (units)	60,000

Required:

2. What is the breakeven point in units for the coming year? $29913 INCORRECT

4-a. What will be the new breakeven point if the additional $213,280 is spent on advertising? 1,959,3000 INCORRECT

4-b. Prepare a contribution income statement at the new breakeven point.

Prepare a contribution income statement at the new breakeven point.

CONNELLY, INC.
Contribution Income Statement
Sales revenue answer correct		$1,959,300 answer correct
Less: Variable costs answer correct		1,809,000 answer incorrect
Contribution margin answer correct		$150,300 answer incorrect
Less: Fixed costs answer correct
Original Amount	$901,280 answer incorrect
Incremental amount	not attempted
		$901,280
Operating profit answer correct		$(750,980)