Waiting for answer This question has not been answered yet. You can hire a professional tutor to get the answer.

QUESTION

# The statement of income for Dimmell Co. presented below represents the operating results for the fiscal year just ended. Dimmell had sales of 1,800...

The statement of income for Dimmell Co. presented below represents the operating results for the fiscal year just ended. Dimmell had sales of 1,800 tons of product during the current year. The manufacturing capacity of Dimmell's facilities is 3,000 tons of product. Dimmell Co.

Statement of Income

For the Year Ended December 31, Year 2

Sales

$900,000 Variable costs: Manufacturing$315,000

Selling costs

180,000

(495,000)

Contribution margin

$405,000 Fixed costs: Manufacturing$ 90,000

Selling

112,500

$157,500 Income taxes (40%) (63,000) Net income$  94,500
Dimmell is considering replacing a highly labor intensive process with an automatic machine. This would result in an increase of $58,500 annually in manufacturing fixed costs. The variable manufacturing costs would decrease$25 per ton. The new breakeven volume in tons would be