Reference no: EM133043134

Question - Blue Spruce manufactures swivel seats for customized vans. It currently manufactures 23,200 seats per year, which it sells for $728 per seat. It incurs variable costs of $364 per seat and fixed costs of $5,127,200. It is considering automating the upholstery process, which is now largely manual. It estimates that if it does this, its fixed costs will be $6 million, and its variable costs will drop to $325 per seat. Prepare a variable-costing income statement based on current activity.