Question
Hudson Company reports the following contribution margin income statement. HUDSON COMPANY Contribution Margin Income Statement For Year Ended December 31 Sales (11,400 units at $225
Hudson Company reports the following contribution margin income statement.
| HUDSON COMPANY | |
| Contribution Margin Income Statement | |
| For Year Ended December 31 | |
| Sales (11,400 units at $225 each) | $ 2,565,000 |
|---|---|
| Variable costs (11,400 units at $180 each) | 2,052,000 |
| Contribution margin | 513,000 |
| Fixed costs | 360,000 |
| Income | $ 153,000 |
The marketing manager believes that increasing advertising costs by $124,000 will increase the companys sales volume to 12,800 units. Prepare a contribution margin income statement for the next year assuming the company incurs the additional advertising costs.
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Survey Of Accounting
Authors: Carl S. Warren
1st Edition
0538870850, 9780538870856
