Hudson Co. reports the contribution margin income statement for 2017.

HUDSON CO.
Contribution Margin Income Statement
For Year Ended December 31, 2017
Sales (11,000 units at $300 each)	$	3,300,000
Variable costs (11,000 units at $240 each)		2,640,000
Contribution margin	$	660,000
Fixed costs		360,000
Pretax income	$	300,000

1. Compute Hudson Co.'s break-even point in units and. 2. Compute Hudson Co.'s break-even point in sales dollars.

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1. Assume Hudson Co. has a target pretax income of $158,000 for 2018. What amount of sales (in dollars) is needed to produce this target income? 2. If Hudson achieves its target pretax income for 2018, what is its margin of safety (in percent)? (Round your answer to 1 decimal place.)

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Assume the company is considering investing in a new machine that will increase its fixed costs by $38,500 per year and decrease its variable costs by $8 per unit. Prepare a forecasted contribution margin income statement for 2018 assuming the company purchases this machine. ----------------------------------------------------------------------------

If the company raises its selling price to $320 per unit. 1. Compute Hudson Co.'s contribution margin per unit. 2. Compute Hudson Co.'s contribution margin ratio. 3. Compute Hudson Co.'s break-even point in units. 4. Compute Hudson Co.'s break-even point in sales dollars. -------------------------------------------------------

The marketing manager believes that increasing advertising costs by $125,000 in 2018 will increase the companys sales volume to 12,400 units. Prepare a forecasted contribution margin income statement for 2018 assuming the company incurs the additional advertising costs.