Required information Problem 18-3A (Algo) Break-even analysis; income targeting and strategy LO C2, A1, P2 [The following information applies to the questions displayed below.] Astro Company sold 25,500 units of its only product and reported income of $277,200 for the current year. During a planning session for next year's 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 $148,000. Total units sold and the selling price per unit will not change. Problem 18-3A (Algo) Part 1 1. Compute the break-even point in dollar sales for next year assuming the machine is installed. (Round your answers to 2 decimal places.) Required information Problem 18-3A (Algo) Break-even analysis; income targeting and strategy LO C2, A1, P2 '[The following information applies to the questions displayed below.] Astro Company sold 25,500 units of its only product and reported income of $277,200 for the current year. During a planning session for next year's activities, the production managet 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 $148,000. Total units sold and the selling price per unit will not change. Problem 18-3A (Algo) Part 2 2. Prepare a contribution margin income statement for next year that shows the expected resuits with the machine installed. Assume sales are $1,275,000. (Do not round intermediate calculations. Round your answers to the nearest whole dollar.) Required information Problem 18-3A (Algo) Break-even analysis; income targeting and strategy LO C2, A1, P2 [The following information applies to the questions displayed below] Astro Company sold 25,500 units of its only product and reported income of $277,200 for the current year. During a planning session for next year's 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 $148,000. Total units sold and the selling price per unit will not change. Problem 18-3A (Algo) Part 3 3. Compute the sales level required in both dollars and units to earn $180,000 of target income for next year with the machine installed. (Do not round intermediate calculations. Round your answers to 2 decimal places. Round "Contribution margin ration" to nearest whole percentage)
