Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. presented is the current year contribution income

Presented is the current year contribution income statement of Grafton Products. Next year, Grafton...

60.1K

Verified Solution

Question

Accounting

Presented is the current year contribution income statement of Grafton Products.

image

Next year, Grafton expects an increase in variable manufacturing costs of $10 per unit and in fixed manufacturing costs of $30,000.

  1. If sales for next year remain at 15,000 units, what price should Grafton charge to obtain the same profit as last year?

  2. Management believes that sales can be increased to 18,000 units if the selling price is lowered to $165. Is this action desirable? (Use the cost data from part a.)

  3. After considering the expected increases in costs, what sales volume is needed to earn a pretax profit of $200,000 with a unit selling price of $165?

GRAFTON PRODUCTS Contribution Income Statement For Year Ended December 3 $2,625,000 $1,275,000 150,000 Sales (15,000 units) Less variable costs Cost of goods sold Selling and administrative.. Contribution margin Less fixed costs Manufacturing overhead.. Selling and administrative. Net income (1,425,000) 1,200,000 685,000 330,000 (1,015,000) $ 185,000

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Electrical Engineering
1.2K views

Using your own words, explain the purpose of using the reset instruction with CTU.

Accounting
1.2K views

Accounting can really be considered the “language of business”. What does this actually mean? With the...

Biology
1.2K views

6 Deforestation and agricultural activities including the production of crops and livestock are thought to...

Biology
1.2K views

Which of the following is NOT one of the four life supporting properties of water...

Basic Math
1.2K views

What is wrong with the following grouped frequency c Grades Frequency 50 55 55 60...

Calculus
1.2K views

Find f x y 24x 12y Answer format Enter the value hint use if needed...

Calculus
1.2K views

Question 9 Integrate 3 cot 3 dx f3 cot

Algebra
1.2K views

Write the equation of the line with slope 1/9 and y-intercept 2.

Accounting
1.2K views

Which of the following is not a benefit to the lessor? High residual value. Off-balance...

Accounting
1.2K views

REQUIRED Use the information provided below to calculate the following variances. Each answer must indicate...

Accounting
1.2K views

The method of earning management, which accounts for future period costs in the current period...

Accounting
1.2K views

Question 6 of 29 - /1 View Policies Current Attempt in Progress At the...