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  3. wildhorse company had sales in 2021 of $1,830,000

Wildhorse Company had sales in 2021 of $1,830,000 on 60,000 units. Variable costs totaled $1,098,000,...

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Accounting

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Wildhorse Company had sales in 2021 of $1,830,000 on 60,000 units. Variable costs totaled $1,098,000, and fixed costs totaled $610,000. A new raw material is available that will decrease the unit variable costs by 20% (or $3.66 ). However, to process the new raw material, fixed operating costs will increase by $122,000. Management feels that one half of the decline in the unit variable costs should be passed on to customers in the form of a sales price reduction. The marketing department expects that this sales price reduction will result in a 5% increase in the number of units sold. (a) Prepare a projected CVP income statement for 2022, assuming the changes have not been made. (Round per unit cost to 2 decimal places, e.g. 5.25 and all other answers to 0 decimal places, e.g. 1,225.) (b) Prepare a projected CVP income statement for 2022, assuming that changes are made as described. (Round per unit cost to 2 decimal places, eg. 5.25 and all other answers to 0 declmal places, eg. 1,225.) (b) Prepare a projected CVP income statement for 2022, assuming that changes are made as described. (Round per unit cost to 2 decimal places, e.g. 5.25 and all other answers to 0 decimal places, e.g. 1,225.)

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