Reference no: EM132502580
Hudson Co.
Contribution margin income statement
For year ended December 31, 2017
Sales (11,500 units at $225 each) $2,587,500
Variable costs (11,500 units at $180 each) $2,070,000
Contribution margin $ 517,500
Fixed costs $360,000
Pretax income $157,500
Question 1: Assume Hudson Co. has a target pretax income of $154,000 for 2018. What amount of sales (in dollars) is needed to produce this target income?
Question 2: If Hudson achieves its target pretax income for 2018, what is its margin of safety (in percent)? Round to one decimal point.