Required information Problem 18-4A Break-even analysis; income targeting and forecasting LO C2, P2, A1 [The following information applies to the questions displayed below) Astro Co. sold 20,900 units of its only product and incurred a $71,860 loss (ignoring taxes) for the current year, as shown here. During a planning session for year 2020's activities, the production manager notes that variable costs can be reduced 40% by installing a machine that automates several operations. To obtain these savings, the company must increase its annual fixed costs by $159,000. The maximum output capacity of the company is 40,000 units per year. ASTRO COMPANY Contribution Margin Income Statement For Year Ended December 31, 2019 Sales Variable costs Contribution margin Fixed costs Net loss $882,568 681,920 200,640 272,see $(71,860) Problem 18-4A Part 3 3. Prepare a forecasted contribution margin income statement for 2020 that shows the expected results with the machine installed Assume that the unit selling price and the number of units sold will not change, and no income taxes will be due. (Do not round intermediate calculations. Round your answers to the nearest whole dollar.) ASTRO COMPANY Forecasted Contribution Margin Income Statement For Year Ended December 31, 2020 Fixed costs Contribution margin ped even analysis; income targeting and forecasting LO C2, P2, A1 [The following information applies to the questions displayed below.) Astro Co. sold 20,900 units of its only product and incurred a $71,860 loss (gnoring texes) for the current year, as shown here. During a planning session for year 2020's activities, the production manager notes that variable costs can be reduced 40% by installing a machine that automates several operations. To obtain these savings, the company must increase its annual fixed costs by $159,000. The maximum output capacity of the company is 40,000 units per year. ASTRO COMPANY Contribution Margin Income Statement For Year Ended December 31, 2019 Sales Variable costs Contribution margin Fixed costs Net loss $802,560 601,920 200,640 272,500 $(71,860) ces Problem 18-4A Part 4 4. Compute the sales level required in both dollars and units to earn $290,000 of target pretax income in 2020 with the machine installed and no change in unit sales price. (Do not round intermediate calculations. Round your answers to 2 decimal places. Round "Contribution margin ratio" to nearest whole percentage) Sales level required in dollars Choose Numerator: Choose Denominator: Sales Dollars Required Sales dollars required Sales level required in units Choose Numerator: 1 Choose Denominator: Sales Units Required Sales units required 0 14 Part 5 of 5 points eBook Required information Problem 18-4A Break-even analysis; Income targeting and forecasting LO C2, P2, A1 [The following information applies to the questions displayed below] Astro Co. sold 20,900 units of its only product and incurred a $71,860 loss (gnoring taxes) for the current year, as shown here. During a planning session for year 2020's activities, the production manager notes that variable costs can be reduced 40% by installing a machine that automates several operations. To obtain these savings, the company must Increase its annual fixed costs by $159,000. The maximum output capacity of the company is 40.000 units per year. ASTRO COMPANY Contribution Margin Income Statement For Year Ended December 31, 2019 Sales Print References Variable costs Contribution margin Fixed costs Net loss $802,560 601,928 200,640 272,500 $(71,868) Problem 18-4A Part 5 5. Prepare a forecasted contribution margin income statement that shows the results at the sales level computed in part 4. Assume no income taxes will be due. (Do not round intermediate calculations. Round "per unit answers" to 2 decimal places.) ASTRO COMPANY Forecasted Contribution Margin Income Statement For Year Ended December 31, 2020 Contribution margin $ Per Unit $ S 38.40 points eBook Hint Print References Mc Graw Handy Home sells windows and doors in the ratio of 8:2 (windows doors). The selling price of each window is $102 and of each door is $252. The variable cost of a window is $63.50 and of a door is $176.00. Fixed costs are $506,000. (Enter your "per unit" values in two decimal places.) (1) Determine the selling price per composite unit. Windows Doors Quantity BS (2) Determine the variable costs per compoalte unit Windows Doors Quantity Contribution margin per composite unit Sales Less Variable costs Contribution margin 2 $ S (3) Determine the break-even point in composite units. Choose Numerator: Total fixed costs 506,000 ' Selling Price per unit 102.00 Total per composite unit $816.00 252.00 504.00 51,320.00 Variable costs per unit Total per composite unit 43.50 $ 508.00 176.00 352.00 S 860.00 1,320.00 860.00 460,00 Choose Denominator: Contribution margin per unit Break Even Units Break even unita $ 460.00 1,100 composite units (4) Determine the number of units of each product that will be sold at the break-even point Number of composite units to break even. Unit sales at break-even point Windows Doors Total Quantity 8 2 1,100 1,100 8,800 Windows 2.200 Doors 11,000 Total < Previ 15 of 18 Next >