Blue Company sold 30,000 units of its only product and incurreda $85,000 loss (ignoring taxes) for the current year as shown here.During a planning session for year 2020’s activities, theproduction manager notes that variable costs can be reduced 25% byinstalling a machine that automates several operations. To obtainthese savings, the company must increase its annual fixed costs by$175,000. The maximum output capacity of the company is 55,000units per year. Blue Company Contribution Margin Income StatementFor Year Ending December 31, 2019 Sales $900,000 Variable $680,000Contribution Margin $220,000 Fixed Cost $305,000 Net Loss $(85,000)Compute the break-even point in dollar sales for year 2019. (Roundyour answers to 2 decimal places.) Compute the predicted break-evenpoint in dollar sales for year 2020 assuming the machine isinstalled and there is no change in the unit selling price. (Roundyour answers to 2 decimal places.)
