Exercise 5-17 (Static) Evaluating strategies- advertising LO C2

The marketing manager believes that increasing advertising costs by $81,000 will increase the company's sales volume to 11,000 units. What contribution margin income statement for the next year assuming the company incurs the additional advertising costs.

Required Information Use the following information for the Exercises below. (Static) [The following information applies to the questions displayed below.] Hudson Company reports the following contribution margin income statement. HUDSON COMPANY Contribution Margin Income Statement For Year Ended December 31 Sales (9,609 units at $225 each) $ 2,160, 080 Variable costs (9,600 units at $180 each) 1, 728, 989 Contribution margin 432,989 Fixed costs 324, 980 Income $ 108, 080 Exercise 5-17 (Static) Evaluating strategles- advertising LO C2 The marketing manager believes that increasing advertising costs by $81,000 will increase the company's sales volume to 11,000 units. Prepare a contribution margin income statement for the next year assuming the company incurs the additional advertising costs. HUDSON COMPANY Contribution Margin Income Statement For Year Ended December 31 Sales Variable costs Contribution margin Fixed costs Income/ Loss