Problem 5-4A 500,000 Units Traditional Income Statement 1 Look at the Income Statement to the right Revenue $ 2,500,000.00 Revenue is 500,000 units sold for $2,500,000 Cost of Goods Sold $ 2,140,000.00 Look at this income statement - they lost $100,000 Gross Profit $ 360,000.00 How many more would they have had to sell to break even (0 pr Selling Expense $ 250,000.00 Admin Expense $ 210,000.00 2 Look at the CVP template file on Canvas and see if you can Net Loss $ (100,000.00) put the given revenue and costs into a CVP income statement for Tanek Company. The problem gives the variable Create CVP Income Statement Below and fixed amounts for each type of expense 3 Use the following formulas to find the Break even points Break even in Units Fixed Costs / Unit Contribution Margin Break even in $$ = Fixed Costs / Contribution Margin % NOTE: The break even in units will not be a whole number you will have to round. Answers: Break even in Units Break even in $$$ 4 Raise the selling price by 20% Do they make a profit? How Much? Leave units and costs the same 5 Company sells 2 products Products % of Business Contribution Margin Tablets 0.6 MP3 Players 0.4 0.35 Fixed Cost $ 120,000 Break Even in $$$$$ How much Tablets How Much MP-3 Players compute break-even alternative courses P5.4A (LO 4), E Tanck Corp.'s sales slumped badly in 2020. For the first time in its history, it operated at a loss. The company's income statement showed the following results from selling 500,000 units of product: sales $2,500,000, total costs and expenses $2,600,000, and net loss $100,000. Costs and expenses consisted of the amounts shown below. Total Variable Fixed Cost of goods sold $2,140,000 $1,590,000 S550,000 Selling expenses 250,000 92,000 158,000 Administrative expenses 210,000 68,000 142.000 $2,600,000 $1,750,000 $850,000 Management is considering the following independent alternatives for 2021. 1. Increase unit selling price 20% with no change in costs, expenses, and sales volume. 2. Change the compensation of salespersons from fixed annual salaries totaling $150,000 to total salaries of $60,000 plus a 5% commission on sales. Instructions a. Compute the break-even point in dollars for 2020. b. Compute the break-even point in dollars under each of the alternative courses of action. (Round all ratios to nearest full percent.) Which course of action do you recommend? b. Alternative 1 $2/ - ishartiends for Barani C h eie currently Commuter bal