TB FA Problem Qu. 05-228 (Static) Houston Company sold... Houston Company sold 40,000 units of its only product and reported income of $50,000 for the current year. Contribution Margin Income Statement For Year Ended December 31 Sales ($50 per unit) $ 2,000,000 Variable costs ($40 per unit) 1,600,000 Contribution margin 400,000 Fixed costs 350,000 Income $ 50,000 During a planning session for the next year's activities, the production manager notes that variable costs can be reduced by 40% by installing a machine that automates several operations. To obtain these savings, the company must increase its annual fixed costs by $482,000. The selling price per unit will not change. Required: (a) Compute the break-even point in dollar sales for next year assuming the machine is installed. (6) Prepare a contribution margin income statement for next year that shows the expected results with the machine installed. (c) Compute the sales level required in both dollars and units to earn $416,000 of target income for next year with the machine installed. Please submit your file attachment response in one of the approved file formats; Word file (.doc or .docx), Excel file (.xls or .xlsx), or PDF. To submit photo or image files please paste them into Word or PDF. Consult with your instructor as needed on their preferred file attachment format. TB FA Problem Qu. 05-226 (Static) Allen Company monthly data for the... Allen Company monthly data for the past year follow. Management wants to use these data to predict future variable and fixed costs Month 1 2 3 4 5 6 7 8 9 10 11 12 Units Sold 640,000 320,000 560,000 400,000 600,000 400,000 680,000 560,000 160,000 320,000 200,000 220,000 Total Cost $ 320,000 200,000 440,000 200,000 460,000 240,000 440,000 320,000 128,000 280,000 200,000 160,000 (1) Estimate both the variable costs per unit and the total monthly fixed costs using the high-low method (2) Use the answers for variable and fixed costs from part 1 to predict future total costs when sales volume is (a) 440,000 units and (b) 480,000 units