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Introduction to managerial accounting (8th ed.). Brewer, P., Garrison, R. & Noreen, E. (2019). (I hope this help, Thx!) Option #2: Cost Volume Profit Analysis

Introduction to managerial accounting (8th ed.). Brewer, P., Garrison, R. & Noreen, E. (2019). (I hope this help, Thx!)

Option #2: Cost Volume Profit Analysis Yellow Company sold 45,000 units of its only product and incurred a $105,000 loss (ignoring taxes) for the current year as shown here. During a planning session for year 2020s activities, the production manager notes that variable costs can be reduced 50% by installing a machine that automates several operations. To obtain these savings, the company must increase its annual fixed costs by $100,000. The maximum output capacity of the company is 75,000 units per year. Yellow Company Contribution Margin Income Statement For Year Ending December 31, 2019 Sales $1,050,000 Variable $805,000 Contribution Margin $245,000 Fixed Cost $350,000 Net Loss $(105,000) 1. Compute the break-even point in dollar sales for year 2019. (Round your answers to 2 decimal places.) 2. Compute the predicted break-even point in dollar sales for year 2020 assuming the machine is installed and there is no change in the unit selling price. (Round your answers to 2 decimal places.) 3. You are the management accountant for Yellow Company. You are required to present your analysis of the calculations above to upper management in a PowerPoint presentation. Complete Items 1 and 2 above in an Excel spreadsheet using the answer template linked here. Be sure to select the correct option using the appropriate tab at the base of the spreadsheet. Make sure to show your work (i.e., calculations).

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