Carey Company had sales in 2019 of $1,923,000 on 64,100 units. Variable costs totaled $897,400, and...

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Carey Company had sales in 2019 of $1,923,000 on 64,100 units. Variable costs totaled $897,400, and fixed costs totaled $502,000. A new raw material is available that will decrease the variable costs per unit by 20% (or $2.80). However, to process the new raw material, fixed operating costs will increase by $98,000. Management feels that one-half of the decline in the variable costs per unit should be passed on to customers in the form of a sales price reduction. The marketing department expects that this sales price reduction will result in a 5% increase in the number of units sold. (a) Prepare a projected CVP income statement for 2020, assuming the changes have not been made. Sales Variable Costs Contribution Margin Fixed Costs Net Income/(Loss) CAREY COMPANY CVP Income Statement For the Year Ended December 31, 2020 $ $ Total 1923000 897400 1025600 502000 i 523600 $ +A $ Per Unit 14 30 i 16 (b) Prepare a projected CVP income statement for 2020, assuming that changes are made as described. (Round per unit cost to 2 decimal places, e.g. 5.25 and all other answers to O decimal places, e.g. 1,225.) Sales Variable Costs Contribution Margin Fixed Costs Net Income/(Loss) ▼ CAREY COMPANY CVP Income Statement For the Year Ended December 31, 2020 ▼ $ Total 195195 76440 11875 600000 i 481245 $ $ Per Unit 28.6 11.2 i 7.4 Carey Company had sales in 2019 of $1,923,000 on 64,100 units. Variable costs totaled $897,400, and fixed costs totaled $502,000. A new raw material is available that will decrease the variable costs per unit by 20% (or $2.80). However, to process the new raw material, fixed operating costs will increase by $98,000. Management feels that one-half of the decline in the variable costs per unit should be passed on to customers in the form of a sales price reduction. The marketing department expects that this sales price reduction will result in a 5% increase in the number of units sold. (a) Prepare a projected CVP income statement for 2020, assuming the changes have not been made. Sales Variable Costs Contribution Margin Fixed Costs Net Income/(Loss) CAREY COMPANY CVP Income Statement For the Year Ended December 31, 2020 $ $ Total 1923000 897400 1025600 502000 i 523600 $ +A $ Per Unit 14 30 i 16 (b) Prepare a projected CVP income statement for 2020, assuming that changes are made as described. (Round per unit cost to 2 decimal places, e.g. 5.25 and all other answers to O decimal places, e.g. 1,225.) Sales Variable Costs Contribution Margin Fixed Costs Net Income/(Loss) ▼ CAREY COMPANY CVP Income Statement For the Year Ended December 31, 2020 ▼ $ Total 195195 76440 11875 600000 i 481245 $ $ Per Unit 28.6 11.2 i 7.4

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