Marks $10$

$3$ Blossom Company had sales in $2022$ of $$1,250,000$ on $50,000$ units. Variable costs totalled $$500,000,$ and fixed costs totalled $$630$

$4$

$5$ A new raw material is available that will decrease the variable costs per unit by $20\%($or $$2\mathrm{.}00).$

$6$ However, to process the new raw material, fixed operating costs will increase by $$30,000.$

$7$ Management feel that one half of the decline in the variable costs per unit should be passed on to customers in the form of a sale $8$ The marketing department expects that this sales price reduction will result in a $10\%$ increase in the number of units sold.

$9$

$10$ Prepare a CVP income statement for $2022$: $($Round per unit cost to $2$ decimal places, e$.$g$.15\mathrm{.}25.)$

$11$ Assuming that changes are made as described.

$12$

$13$

$14$