Henna Co. produces and sells two products, T and O. It manufactures these products in separate factories and markets them through different channels. They have no shared costs. This year, the company sold 51,000 units of each product. Sales and costs for each product follow.

	Product T					Product O
Sales		$	821,100				$	821,100
Variable costs			492,660					82,110
Contribution margin			328,440					738,990
Fixed costs			187,440					597,990
Income before taxes			141,000					141,000
Income taxes (32% rate)			42,300					42,300
Net income		$	98,700				$	98,700

Problem 18-5A Part 1 Required: 1. Compute the break-even point in dollar sales for each product. (Enter CM ratio as percentage rounded to 2 decimal places.) Product T Contribution Margin Ratio Choose Numerator: 1 Choose Denominator: Contribution Margin Ratio Contribution margin ratio = 0 Break-even point in dollars Choose Numerator: / Choose Denominator: Break-Even Point in Dollars Break-even point in dollars / Producto Contribution Margin Ratio / Contribution margin ratio 0 Break-Even Point in Dollars 1 = Break-even point in dollars 0 2. Assume that the company expects sales of each product to decline to 34,000 units next year with no change in unit selling price. Prepare forecasted financial results for next year following the format of the contribution margin income statement as just shown with columns for each of the two products (assume a 30% tax rate). Also, assume that any loss before taxes yields a 30% tax benefit. (Round "per unit" answers to 2 decimal places. Enter losses and tax benefits, if any, as negative values.) HENNA CO. Forecasted Contribution Margin Income Statement Product T Producto Total Units $ Per unit Total $ Per unit Total $ 0 $ olo 0 0 Contribution margin Olo 0 Net income (loss) 3. Assume that the company expects sales of each product to increase to 65,000 units next year with no change in unit selling price. Prepare forecasted financial results for next year following the format of the contribution margin income statement shown with columns for each of the two products (assume a 30% tax rate). (Round "per unit" answers to 2 decimal places.) HENNA CO. Forecasted Contribution Margin Income Statement Product T Producto Total Units $ Per unit Total $ Per unit Total $ 0 $ 0 $ Oo 0 0 Contribution margin 0 0 Net income (loss) $ 0