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Required information [The following information applies to the questions displayed below.) Astro Co. sold 20,000 units of its only product and incurred a $50,000 loss

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Required information [The following information applies to the questions displayed below.) Astro Co. sold 20,000 units of its only product and incurred a $50,000 loss (ignoring taxes) for the current year as shown here. During a planning session for year 2018'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 $200,000. The maximum output capacity of the company is 40,000 units per year. ASTRO COMPANY Contribution Margin Income Statement For Year Ended December 31, 2017 Sales $1,000,000 Variable costs 800,000 Contribution margin 200,000 Fixed costs 250,000 Net loss $ (50,000) 3. Prepare a forecasted contribution margin income statement for 2018 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. ASTRO COMPANY Forecasted Contribution Margin income Statement For Year Ended December 31, 2018 Contribution margin 4. Compute the sales level required in both dollars and units to earn $200,000 of target pretax income in 2018 with the machine installed and no change in unit sales price. Sales lovel required in dollars Choose Numerator: Choose Denominator: Sales Dolors Required Sales dollars required Sales level required in units Choose Numerator Choose Denominator Sates Units Required Sales units required 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 (Round your intermediate cateulation and final answer to the nearest whole dollar) ASTRO COMPANY Forecasted Contribution Margin Income Statement For Your Linded December 31, 2018 5 Per Unit $ 50 Contribution margin

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