Bessler Brothers manufactures a carbon fiber head scratcher. Below is December 31st data:
	Sales (118,000 units at $5 per unit)			590,000
	Variable expenses			472,000
	Contribution Margin			118,000
	Fixed expenses			125,000
	Net operating loss			(7,000)

b. Assume the company expects to sell 125,000 units next month. Prepare two contribution format

income statements, (1) assuming that operations are not automated, (the only change is units), and

(2) a statement reflecting the automation (reduce variable by 50% and increase fixed by $115,000).

Answer rating: 100% (QA)

Contribution Format Income Statement Not Automated Amount Sales 125000 units 625... View the full answer