Astro Co. sold 20,300 units of its only product and incurred a $78,798 loss (ignoring taxes)...

  

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Astro Co. sold 20,300 units of its only product and incurred a $78,798 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 50% by installing a machine that automates several operations. To obtain these savings, the company must Increase its annual fixed costs by $153,000. The maximum output capacity of the company is 40.000 units per year. ASTRO COMPANY Contribution Margin Income Statement For Year Ended December 31, 2019 Sales Variable costs Contribution margin Fixed costs Net loss Problem 05-4A Part 3 $767,340 537,138 230,202 309,000 $ (78,798) 4 3. Prepare a forecasted contribution margin income statement for 2020 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. (Do not round intermediate calculations. Round your answers to the nearest whole dollar.) 3. Prepare a forecasted contribution margin income statement for 2020 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. (Do not round intermediate calculations. Round your answers to the nearest whole dollar.) ASTRO COMPANY Forecasted Contribution Margin Income Statement For Year Ended December 31, 2020 Contribution margin A Astro Co. sold 20,300 units of its only product and incurred a $78,798 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 50% by installing a machine that automates several operations. To obtain these savings, the company must Increase its annual fixed costs by $153,000. The maximum output capacity of the company is 40.000 units per year. ASTRO COMPANY Contribution Margin Income Statement For Year Ended December 31, 2019 Sales Variable costs Contribution margin Fixed costs Net loss Problem 05-4A Part 3 $767,340 537,138 230,202 309,000 $ (78,798) 4 3. Prepare a forecasted contribution margin income statement for 2020 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. (Do not round intermediate calculations. Round your answers to the nearest whole dollar.) 3. Prepare a forecasted contribution margin income statement for 2020 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. (Do not round intermediate calculations. Round your answers to the nearest whole dollar.) ASTRO COMPANY Forecasted Contribution Margin Income Statement For Year Ended December 31, 2020 Contribution margin A

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SOLUTION 11 I Required 3 ASTRO COMPANY Forecasted contributio... View the full answer