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Nombre Company management predicts $1,672,000 of variable costs, $2,255,000 of fixed costs, and a pretax income of $253,000 i
Nombre Company management predicts $1.672,000 of variable costs, $2,255,000 of fixed costs, and a pretax income of $253,000 i
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Answer #1

Solution:

(1) compute the total expected dollar sales for next period.
Sales 4180000
Less: Variable costs 1672000
Contribution margin 2508000
Less: Fixed cost 2255000
Pretax Income 253000
(2) Number of units expected to be sold next period:
Choose Numerator / Choose Denominator = Units
Fixed cost plus pretax income Contribution margin per unit Units
2508000 57 44000
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