Whirly Corporation’s most recent income statement is shown below: Prepare a new
ID: 2488209 • Letter: W
Question
Whirly Corporation’s most recent income statement is shown below:
Prepare a new contribution format income statement under each of the following conditions (consider each case independently):
The sales volume increases by 50 units.
Whirly CorporationContribution
Income Statement
Total Per Unit
Sales
Variable expenses
Contribution margin
Fixed expenses
Net operating income
2. The sales volume decreases by 50 units.
Whirly CorporationContribution
Income Statement
Total Per Unit
Sales
Variable expenses
Contribution margin
Fixed expenses
Net operating income
The sales volume is 6,900 units.
Whirly CorporationContribution
Income Statement
Total Per Unit
Sales
Variable expenses
Contribution margin
Fixed expenses
Net operating income
Whirly Corporation’s most recent income statement is shown below:
Explanation / Answer
1 The sales volume increases by 50 units.
Sales 7950* 33 = 262350
Variable expenses = 7950 * 18 = 143100
Contribution margin = 119250
Fixed expenses = 54800
Net operating income = 64450
2... The sales volume decreases by 50 units.
Sales 7850 * 33 = 259050 33
Variable expenses = 141300 18
Contribution margin = 117750 15
Fixed expenses 54800
Net operating income 62950
3 The sales volume is 6,900 units.
Sales 6900*33 = 227700
Variable expenses = 124200
Contribution margin = 103500
Fixed expenses = 54800
Net operating income = 48700
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