Lobster Trap Company is considering automating its manufacturing facility. Company information before and after the...
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Lobster Trap Company is considering automating its manufacturing facility. Company information before and after the proposed automation follows:
| Before Automation | After Automation | |||||
| Sales revenue | $ | 206,000 | $ | 206,000 | ||
| Less: Variable cost | 96,000 | 40,000 | ||||
| Contribution margin | $ | 110,000 | $ | 166,000 | ||
| Less: Fixed cost | 13,000 | 64,000 | ||||
| Net operating income | $ | 97,000 | $ | 102,000 | ||
Required: 1. Calculate Lobster Traps break-even sales dollars before and after automation. (Round your contribution margin ratio to 4 decimal places and final answers to 2 decimal places.)
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