Brahma Industries sells vinyl replacement windows to home improvement retailers nationwide. The national sales manager believes that if they invest an additional $24,000 in advertising, they would increase sales volume by 10,000 units. Sales (6,300 units at $113) $711,900 Variable Costs (6,300 units at $71) 447,300 Contribution Margin $264,600 Fixed Cost 19,600 Net Income (Loss) $245,000 Prepare a forecasted contribution margin income statement for Brahma if they incur the additional advertising costs, using the above information. Forecasted contribution Margin Income Statement Sales 1,841,900 Variable Costs 1,157,300 Contribution Margin 684,600 Fixed Cost 43,600 Net Income (Loss) 641,000
Brahma Industries sells vinyl replacement windows to home improvement retailers nationwide. The national sales manager believes that if they invest an additional $24,000 in advertising, they would increase sales volume by 10,000 units. Sales (6,300 units at $113) $711,900 Variable Costs (6,300 units at $71) 447,300 Contribution Margin $264,600 Fixed Cost 19,600 Net Income (Loss) $245,000 Prepare a forecasted contribution margin income statement for Brahma if they incur the additional advertising costs, using the above information. Forecasted contribution Margin Income Statement Sales 1,841,900 Variable Costs 1,157,300 Contribution Margin 684,600 Fixed Cost 43,600 Net Income (Loss) 641,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Making I did the numbers correctly?
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b Marlin Motors sells a single X
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Brahma Industries sells vinyl replacement windows to home improvement retailers nationwide. The national sales manager believes that if they invest an additional $24,000 in
advertising, they would increase sales volume by 10,000 units.
Sales (6,300 units at $113)
$711,900
Variable Costs (6,300 units at $71) 447,300
Contribution Margin
$264,600
Fixed Cost
19,600
Net Income (Loss)
$245,000
Prepare a forecasted contribution margin income statement for Brahma if they incur the additional advertising costs, using the above information.
Forecasted contribution Margin Income
Statement
Sales
1,841,900
Variable Costs
1,157,300
Contribution Margin
684,600
Fixed Cost
43,600
Net Income (Loss)
641,000
Expert Solution
Step 1
Total forecasted fixed costs = current fixed costs + additional advertising costs
= $19,600 + 24,000
= $43,600
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