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Astro Co. sold 19,000 units of its only product and incurred a $128,000 loss (ignoring...

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Accounting

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Astro Co. sold 19,000 units of its only product and incurred a $128,000 loss (ignoring taxes) for the current year as shown here. During a planning session for year 2018's activities, the production manager notes that variable costs can be reduced 30% by installing a machine that automates several operations. To obtain these savings, the company must increase its annual fixed costs by $140,000. The maximurm output capacity of the company is 40,000 units per year Contribution Margin Income Statement For Year Ended December 31, 2017 Sales Variable costs Contribution margin Fixed costs Net loss $ 760,000 688,900 152,000 286,000 $ (128,000) 2. Compute the predicted break even point in dollar sales for year 2018 assuming the machine is installed and there is no change in the unit selling price. (Round your answers to 2 decimal places.)

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