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 58.000 units of each product. Sales and costs for each product follow. Sales Variable costs Contribution margin Fixed costs Income before taxes Income taxes (32% rate) Net income Product T $ 974,400 779,520 194,889 46,880 148,000 47,360 $ 100,640 Producto $ 974,400 194,830 779,520 631,520 148,000 47, 360 $ 100,640 Required: 1. Compute the break even point in dollar sales for each product (Enter CM ratio as percentage rounded to 2 decimal places.) Product Contribution Margin Ratio Choose Numerator: Choose Denominator: Contribution Margin Ratio Contribution margin ratio 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 Break Even Point in Dollars Break even point in dollars 0 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 58,000 units of each product Sales and costs for each product follow. Sales Variable costs Contribution margin Fixed costs Income before taxes Income taxes (32% rate) Net income Product T $ 974,400 779,520 194,850 46,880 148,000 47,360 $ 100,640 Producto $ 974,400 194,888 779,520 631,520 148,00 47460 $ 100,640 2. Assume that the company expects sales of each product to decline to 41.000 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 32% tax rate). Also, assume that any loss before taxes yields a 32% 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 Units $ Per unit Total $ Per unit Total $ 0 Total 0 $ 0 0 Contribution margin 0 0 0 Net Income (los) 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 58,000 units of each product. Sales and costs for each product follow Sales Variable costs Contribution margin Fixed costs Income before taxes Income taxes (32% rate) Net Income Product T $ 974,100 779,520 194,380 46,880 143,000 47,360 $ 100,640 Producto $ 974,400 194,880 779,520 631 520 148, eee 47,360 $ 100,640 3. Assume that the company expects sales of each product to increase to 72.000 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 32% tax rate). (Round "per unit" answers to 2 decimal places.) HENNA CO. Forecasted Contribution Margin Income Statement Product T Producto Units $ Per unit Total $ Per unit Total Total Contribution margin Net Income (105)
