Hudson Company reports the following contribution margin income statement.

HUDSON COMPANY

Contribution Margin Income Statement

For Year Ended December $31$

Sales $(9,600$ units at $$225$ each$)$ $ $2,160,000$

Variable costs $(9,600$ units at $$180$ each$)1,728,000$

Contribution margin $432,000$

Fixed costs $324,000$

Income $ $108,000$

The company is considering buying a new machine that will increase its fixed costs by $$40,500$ per year and decrease its variable costs by $$9$ per unit.

 Prepare a contribution margin income statement for the next year assuming the company purchases this machine. 

Answer rating: 100% (QA)

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