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Required information The following information applies to the questions displayed below.) Astro Co sold 20,600 units of its only product and incurred a $55,028 loss
Required information The following information applies to the questions displayed below.) Astro Co sold 20,600 units of its only product and incurred a $55,028 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 $156,000. 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 5784, 850 Variable costs 627 Contribution margin Fixed costs 212,000 Net loss 5(55,028) 4. Compute the sales level required in both dollars and units to earn $260,000 of target pretax income in 2018 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 r ed in units Choose Numerator Choose Denom ator: Sales units required Sales units required
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