Reference no: EM131287281
Astro Co. sold 20.000 units of its only product and incurred a $50.000 loss (ignoring taxes) for the current year as shown here. During a planning session for year 2016's activities, the production manager notes that variable cost can be reduced 50% by installing a machine that automates several operations. to obtain these savings , the company must increase its anualfixed costs by $200.000. the maximunoutput capacity of the company is 40.000 units per year.
astro company contribution margin income statement for year ended december 31, 2015
sales $1'000.000
variable cost $800.000
contribution margin $200.000
fixed cost $250.000
net loss $(50.000)
required:
1. compute the break even point in dollar sales for year 2015
2. compute the predicted break even point in dollar sales for year 2016 assuming the machine is installed and there is no change in the unit selling price.
3. prepare a forescasted contribution margin income statement for 2016 that shows the expected results with the machine installed. assume that the unit selling price and the number of units sold will not change , and no income taxes will be due.
4. compute the sales level required in both dollars and units to earn $200.000 of target pretax income in 2016 with the machine installed and no change in unit sales price . round answers to whole dollars and whole units.
5. prepare a forecasted contribution margin income statement that show the results at the sales level computed in part 4. Assume no income taxes will be due.
Attributes of a project
: Using the concepts within the textbook, outline some attributes of a project, and describe their overall purpose. Explain how a project would be affected if any of the attributes were suddenly removed.
|
Financial statements for your personal life
: identify at least two examples of how your household uses the accrual basis of accounting. Second, identify them as a deferral or an accrual. Third, if you were to have financial statements for your personal life (household) - how are these two examp..
|
The fundamental ways in which the ncaas ethics program
: Determine the fundamental ways in which the NCAA's ethics program failed to prevent the scandals at Penn State, Ohio State, and the University of Arkansas. Support your response with one (1) example from each of these schools' scandals.
|
Cumulative and a noncumulative quantity discount
: If you worked for a manufacturing firm located in Oregon and shipped merchandise all over the United States, which would be more advantageous, a zone or a uniform delivered pricing policy? Why?
|
Compute the predicted break even point in dollar sales
: Astro Co. sold 20.000 units of its only product and incurred a $50.000 loss (ignoring taxes) for the current year as shown here. During a planning session for year 2016's activities, compute the break even point in dollar sales for year 2015. comput..
|
What are the performance considerations
: What are the performance considerations? What are the security requirements? Should we buy or build? What solutions does our competition leverage?
|
Under the lease agreement
: What is the future value of 22 periodic payments of $4,140 each made at the beginning of each period and compounded at 8%? Cullumber Company recently signed a lease for a new office building, for a lease period of 10 years. Under the lease agreement,..
|
Describe the individual characteristics of the organism
: Describe the individual characteristics of the organism. Describe the disease process caused by the organism including the physiology and structural changes caused by the organism.
|
Funds for transactions-what is the value of holdings
: Orbital Communications has operating plants in over 100 countries. It also keeps funds for transactions purposes in many foreign countries. Assume in 2010 it held 220,000 kronas in Norway worth $47,000. The funds drew 14 percent interest, and the kro..
|