Required information Use the following information for the Exercises below. (The following information applies to the questions displayed below.) Hudson Co. reports the contribution margin income statement for 2017. HUDSON Co. Contribution Margin Income Statement For Year Ended December 31, 2017 Sales (11,400 units at $225 each) Variable costs (11,400 units at $180 each) Contribution margin - Fixed costs Pretax income $2,565,000 2,052,000 $ 513,000 360,000 $ 153,000 Exercise 21-16 Break-even LO P2 1. Compute Hudson Co.'s break-even point in units and 2. Compute Hudson Co.'s break-even point in sales dollars. units Break-even point Break-even point 2. Required information Use the following information for the Exercises below. The following information applies to the questions displayed below.) Hudson Co. reports the contribution margin income statement for 2017, HUDSON CO. Contribution Margin Income Statement For Year Ended December 31, 2017 Sales (11,400 units at $225 each) Variable costs (11,400 units at $180 each) Contribution margin Fixed costs Pretax income $2,565,000 2,052,000 $ 513,000 360,000 $ 153,000 Exercise 21-17 Target income and margin of safety (in dollars) LO C2 1. Assume Hudson Co. has a target pretax income of $150,000 for 2018. What amount of sales (in dollars) is needed to produce this target Income? 2. If Hudson achieves its target pretax income for 2018, what is its margin of safety (in percent)? (Round your answer to 1 decimal place.) 1. Amount of sales 2. Margin of safety 3 of 5 Required information Use the following information for the Exercises below. The following information applies to the questions displayed below.) Hudson Co. reports the contribution margin income statement for 2017 HUDSON CO. Contribution Margin Income Statement For Year Ended December 31, 2017 Sales (11,400 units at $225 each) Variable costs (11,400 units at $180 each) Contribution margin - Fixed costs Pretax income eBook $2,565,000 2,052,000 $ 513,000 360.000 $ 153,000 Hint Print Exercise 21-17 Target income and margin of safety (in dollars) LO C2 1. Assume Hudson Co. has a target pretax income of $150,000 for 2018. What amount of sales in dollars) is needed to produce this target income? 2. If Hudson achieves its target pretax income for 2018, what is its margin of safety (in percent)? (Round your answer to 1 decimal place.) 1. Amount of sales 2. Margin of safety - Required information Use the following information for the Exercises below. (The following information applies to the questions displayed below.) Hudson Co. reports the contribution margin income statement for 2017 Por redon MarS ON Co. Contribution Margin Income Statement For Year Ended December 31, 2017 Sales (11,400 units at $225 each) Variable costs (11,400 units at $180 each) Contribution margin Fixed costs Pretax income $2,565,000 2,052,000 $ 513,000 360,000 $ 153,000 Exercise 21-16 Break-even LO P2 1. Compute Hudson Co.'s break-even point in units and. 2. Compute Hudson Co.'s break-even point in sales dollars. 1. 2. Break-even point Break-even point Required information Use the following information for the Exercises below. The following information applies to the questions displayed below.) Hudson Co. reports the contribution margin income statement for 2017 HUDSON Co. Contribution Margin Income Statement For Year Ended December 31, 2017 Sales (11,400 units at $225 each) Variable costs (11,400 units at $180 each) Contribution margin Fixed costs Pretax income $2,565,000 2,052,000 $ 513,000 360,000 $ 153,000 Exercise 21-18 Evaluating strategies LO C2 Assume the company is considering investing in a new machine that will increase its fixed costs by $36,500 per year and decrease its variable costs by $9 per unit. Prepare a forecasted contribution margin income statement for 2018 assuming the company purchases this machine. HUDSON CO. Forecasted Contribution Margin Income Statement For Year Ended December 31, 2018 Sales Variable costs Contribution margin Fixed costs Income (pretax) Should the company purchase the machine? OS 21-14 Sales mix and break-even LO P4 JS-Mobile manufactures and sells two products, tablet computers and smartphones, in the ratio of 6:4. Fixed costs are $87,000, and he contribution margin per composite unit is $116. What number of each type of product is sold at the break-even point? Determine the break-even point in composite units Choose Numerator: Choose Denominator: Break even units Break even units Determine the number of units of each product that will be sold at the break-even point. Quantity Number of composite units to Unit sales at break-even point break even Tablet computers Smartphones Total units Exercise 21-12 Computing sales to achieve target income LO C2 Blanchard Company manufactures a single product that sells for $100 per unit and whose total variable costs are $76 per unit. The company's annual fixed costs are $338,400. Management targets an annual pretax income of $600,000. Assume that fixed costs remain at $338,400. (1) Compute the unit sales to earn the target income. Choose Numerator: Choose Denominator: Units to Achieve Target Units to achieve target (2) Compute the dollar sales to earn the target Income. Choose Numerator: 1 Choose Denominator: - - Dollars to Achieve Target Dollars to achieve target
