Crane Company had sales in 2021 of $ 1,230,000 on 60,000 units. Variable costs totaled $ 738,000, and fixed costs totaled $ 410,000. The new raw material is available that will decrease the unit variable costs by 20% (or $ 2.46). However, to process the new raw material, fixed operating costs will increase by $ 82,000. Management feels that one-half of the decline in the unit variable costs 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 5% increase in the number of units sold.

(a) Prepare a projected CVP income statement for 2022, assuming the changes have not been made

(b) Prepare a projected CVP income statement for 2022, assuming that changes are made as described.