Business, 26.03.2020 23:42 cxttiemsp021

Astro Co. sold 20,700 units of its only product and incurred a $83,778 loss (ignoring taxes) for the current year as shown here. During a planning session for year 2018’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 $157,000. The maximum output capacity of the company is 40,000 units per year. ASTRO COMPANY Contribution Margin Income Statement For Year Ended December 31, 2017 Sales $ 790,740 Variable costs 553,518 Contribution margin 237,222 Fixed costs 321,000 Net loss $ (83,778 ) Required: 1. Compute the break-even point in dollar sales for year 2017. (Round your answers to 2 decimal places.)

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Astro Co. sold 20,700 units of its only product and incurred a $83,778 loss (ignoring taxes) for the...

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