Per Unit 6.00 3.00 3.00 Total Sales (31,000 units) Variable expenses Contributio

Question

Per Unit 6.00 3.00 3.00 Total Sales (31,000 units) Variable expenses Contribution margin Fixed expenses Net operating income $ 186,000 93,000 93,000 42,000 $ 51,000 Required (Consider each case independently) : 1. what is the revised net operating income if unit sales increase by 19%? 2. What is the revised net operating income if the selling price decreases by $1.30 per unit and the number of units sold increases by 21%? 3. What is the revised net operating income if the selling price increases by $1.30 per unit, fixed expenses increase by $7,000, and the : number of units sold decreases by 5%? 4, what is the revised net operating income if the selling price per unit increases by 10%, variable expenses increase by 30 cents per unit, and the number of units sold decreases by 12%? 1. Net operating income 2. Net operating income 3. Net operating income 4. Net operating income

Explanation / Answer

1. If unit sales increased by 19%

2.

3

4.

Particular Total Per unit Sales (36890) $221,340 $6 Variable cost $(110,670) $3 Contribution margin $110,670 Fixed expenses $(42,000) Net Operating Income $68,670

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