Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Hudson Co. reports the contribution margin income statement for 2017. HUDSON CO. Contribution Margin Income Statement For Year Ended December 31, 2017 Sales (10,900 units

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

HUDSON CO.
Contribution Margin Income Statement
For Year Ended December 31, 2017
Sales (10,900 units at $225 each) $ 2,452,500
Variable costs (10,900 units at $180 each) 1,962,000
Contribution margin $ 490,500
Fixed costs 387,000
Pretax income $ 103,500

1. Assume Hudson Co. has a target pretax income of $159,000 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.)

Amount of sales: _____ Margin of safety: _____

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

The Audit Process Principles Practice And Cases

Authors: Stuart Manson, Iain Gray, Iain G. Sheffield, I.H. Gray, I. Etal Gray

2nd Edition

1861520107, 9781861520104

More Books

Students also viewed these Accounting questions