Business, 14.10.2019 21:00 samafeggins2

Walton company currently produces and sells 6,800 units annually of a product that has a variable cost of $18 per unit and annual fixed costs of $174,400. the company currently earns a $84,000 annual profit. assume that walton has the opportunity to invest in new labor-saving production equipment that will enable the company to reduce variable costs to $16 per unit. the investment would cause fixed costs to increase by $9,800 because of additional depreciation cost. required use the equation method to determine the sales price per unit under existing conditions (current equipment is used). prepare a contribution margin income statement, assuming that walton invests in the new production equipment.

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