Question
Hudson Co. reports the contribution margin income statement for 2019. HUDSON CO. Contribution Margin Income Statement For Year Ended December 31, 2019 Sales (11,000 units
Hudson Co. reports the contribution margin income statement for 2019.
| HUDSON CO. | |||
| Contribution Margin Income Statement | |||
| For Year Ended December 31, 2019 | |||
| 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 | |
The marketing manager believes that increasing advertising costs by $125,000 in 2020 will increase the companys sales volume to 12,400 units. Prepare a forecasted contribution margin income statement for 2020 assuming the company incurs the additional advertising costs.
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Auditing Practices A Complete Guide
Authors: Gerardus Blokdyk
2023rd Edition
1038804450, 978-1038804457
