Milton Corporation manufactures skateboards and is in the process of preparing next year€™s budget. The pro forma income statement for the current year is as follows:

Required:
1. What is the break-even revenue (rounded to the nearest dollar) for Milton Corporation for the current year?
2. For the coming year, the management of Milton Corporation anticipates a 10 percent increase in variable costs and a $45,000 increase in fixed expenses. What is the break-even revenue for next year?

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Sales Cost of sales: $1,500,000 Direct mate Direct labor Variable overheac Fixed overhead $250,000 150,000 80,000 100,000 580,000 $ 920,000 Gross profit Selling and administrative expenses Variable Fixed $300,000 250,000 550,000 Operating income