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 | |||
Nombre Company management predicts $1,672,000 of variable costs, $2,255,000 of fixed costs, and a pretax income...
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