Last month when Holiday Creations, Inc., sold 35,000 units, total sales were $29

Question

Last month when Holiday Creations, Inc., sold 35,000 units, total sales were $291,000, total variable expenses were $226,980, and fixed expenses were $39,600.
rev: 02-17-2011

5. value:
3.00 points Requirement 1: What is the company's contribution margin (CM) ratio?(Round your final answer to the nearest whole percentage. Omit the "%" sign in your response.)
Contribution margin ratio %
rev: 02-17-2011 check my workeBook Linkreferences

6. value:
3.00 points Requirement 2: Estimate the change in the company's net operating income if it were to increase its total sales by $1,200.(Round your final answer to the nearest whole dollar amount. Omit the "$" sign in your response.).
Estimated change in net operating income $

Last month when Holiday Creations, Inc., sold 35,000 units, total sales were $291,000, total variable expenses were $226,980, and fixed expenses were $39,600.
rev: 02-17-2011
5. value:
3.00 points Requirement 1: What is the company's contribution margin (CM) ratio?(Round your final answer to the nearest whole percentage. Omit the "%" sign in your response.)
Contribution margin ratio %
rev: 02-17-2011 check my workeBook Linkreferences

5. value:
3.00 points 5. value:
3.00 points Requirement 1: What is the company's contribution margin (CM) ratio?(Round your final answer to the nearest whole percentage. Omit the "%" sign in your response.)
Contribution margin ratio %
rev: 02-17-2011 check my workeBook Linkreferences

Requirement 1: What is the company's contribution margin (CM) ratio?(Round your final answer to the nearest whole percentage. Omit the "%" sign in your response.)
Contribution margin ratio %
rev: 02-17-2011 check my workeBook Linkreferences

check my workeBook Linkreferences 6. value:
3.00 points Requirement 2: Estimate the change in the company's net operating income if it were to increase its total sales by $1,200.(Round your final answer to the nearest whole dollar amount. Omit the "$" sign in your response.).
Estimated change in net operating income $

6. value:
3.00 points 6. value:
3.00 points Requirement 2: Estimate the change in the company's net operating income if it were to increase its total sales by $1,200.(Round your final answer to the nearest whole dollar amount. Omit the "$" sign in your response.).
Estimated change in net operating income $

Requirement 2: Estimate the change in the company's net operating income if it were to increase its total sales by $1,200.(Round your final answer to the nearest whole dollar amount. Omit the "$" sign in your response.).
Estimated change in net operating income $

Last month when Holiday Creations, Inc., sold 35,000 units, total sales were $291,000, total variable expenses were $226,980, and fixed expenses were $39,600.

Explanation / Answer

Sales: $291000 Variable expenses: $226980 Contribution: $291000 - 226980 = $64020 (5) Contribution margin ratio = 64020/291000 = 22.00% (6) If sales increase by $1200, then there will be an increase in net operating income of 1200 x 0.22 = $264 Hope this helps!

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