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Hudson Company reports the following contribution margin income statement. HUDSON COMPANY Contribution Margin Income Statement...

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Accounting

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 marketing manager believes that increasing advertising costs by $81,000 will increase the companys sales volume to 11,000 units.

A.) Prepare a contribution margin income statement for the next year assuming the company incurs the additional advertising costs.

B.) Hudson Company reports the following contribution margin income statement. The marketing manager believes that increasing advertising costs by $81,000 will increase the companys sales volume to 11,000 units. Prepare a contribution margin income statement for the next year assuming the company incurs the additional advertising costs.

C.) 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.

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