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Given the following abbreviated Income Statement for the Twelve Months Ended December 31, 2020, what would the statement look like for 2021 if sales
Given the following abbreviated Income Statement for the Twelve Months Ended December 31, 2020, what would the statement look like for 2021 if sales are expected to grow 6% and fixed costs will remain the same as 2020? Please calculate and show the 2021 statement side by side with the 2020 statement. Also, please calculate and explain the breakeven point (in sales dollars) for the company for 2020 and 2021. And, calculate and show the sales dollars required (based on the 2020 statement) if the company desired an Operating Margin of $1,250,000. Finally, describe the actions the company might take to lower its breakeven point in sales dollars and, given a very competitive market, which actions might be more desirable than others? Ignore federal and state income taxes for this analysis. Write a brief analysis (not more than two to three pages in length and in good APA format), explaining the calculations performed and their results, giving special attention to cost-volume-profit relationships. Assume your audience is the CEO and Marketing V.P for the company each of whom have very limited knowledge of Accounting and Finance. In this regard, it is desirable to also include some type of visualization to explain the results of your analysis. Social Media Marketing, LLC Income Statement For the Twelve Months Ended December 31, 2020 Sales.... Cost of Sales $2,500,000 1,250,000 Contribution Margin. $ 1,250,000
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