Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Required information (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

image text in transcribed

Required information (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 $ 802,560 Variable costs 601,920 Contribution margin 200, 640 Fixed costs 272,500 Net loss $ (71,860) es Required: 1. Compute the break-even point in dollar sales for 2019. (Round your answers to 2 decimal places.) Contribution Margin Per Unit Current Year S 0.00 Contribution Margin Ratio Choose Numerator: Choose Denominator: Contribution Margin Ratio Contribution margin ratio 0 Break-Even Point in Dollar Sales: Choose Numerator: Choose Denominator: = Break-Even Point in Dollars Break-even point in dollars 0

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

FINANCIAL & MANAGERIAL ACCOUNTING FOR DECISION MAKERS

Authors: Dyckman, Hanlon, Magee, Pfeiffer, Hartgraves, Morse

3rd Edition

1618532340, 9781618532343

More Books

Students also viewed these Accounting questions