Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The following information applies to the questions displayed below] Astro Co sold 19,700 units of its only product and incurred a $59.290 loss (ignoring taxes)

image text in transcribed
The following information applies to the questions displayed below] Astro Co sold 19,700 units of its only product and incurred a $59.290 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 $147000 The maximum output capacity of the company is 40,000 units per year. ASTRO COMPANY Contribution Margin incon Statement fon Year Ended December 31, 2019 Sales 3732,40 Variable costs 549.630 Contribution margin 183,210 Fixed cost 242,500 Net loss $ (59,290) Problem 18-4A Part 4 4. Compute the sales level required in both dollars and units to earn $170.000 of target pretax income in 2020 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) Answer is not complete. Sales level required in dollars Choose Numerator Choose Denominator: Contribution margin ratio Sales Dollars Required Sales dollars required Fixed costs plus protax income Salus level required in units Choose Numerator Fixed costs plus protax income Choose Denominaton Contribution margin per unit Sales Units Required Sales units required 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

Managerial Accounting

Authors: John Wild, Ken Shaw

5th edition

978-1259176494, 1259176495, 978-1259347641, 1259347648, 978-0078025600

More Books

Students also viewed these Accounting questions