Answered step by step
Verified Expert Solution
Link Copied!

Question

00
1 Approved Answer

1. If sales decline to 900 units, what would be the net operating income? (Round Per Unit calculations to 2 decimal places.) 2. If the

image text in transcribed

1. If sales decline to 900 units, what would be the net operating income? (Round "Per Unit" calculations to 2 decimal places.) 2. If the variable cost per unit increases by $1, spending on advertising increases by $1,300, and unit sales increase by 160 units, what would be the net operating income? (Round "Per Unit" calculations to 2 decimal places.)

3. What is the break-even point in unit sales? (Round intermediate calculations to 2 decimal places.) 4. What is the break-even point in dollar sales?

5. How many units must be sold to achieve a target profit of $8,400? (Round intermediate calculations to 2 decimal places.)

6. Using the degree of operating leverage, what is the estimated percent increase in net operating income that would result from a 5% increase in unit sales? (Round your intermediate calculations and final answer to 2 decimal places.)

7. Assume that the amounts of the companys total variable expenses and total fixed expenses were reversed. In other words, assume that the total variable expenses are $8,680 and the total fixed expenses are $26,000. Under this scenario and assuming that total sales remain the same, what is the degree of operating leverage? (Round your answer to 2 decimal places.)

8. Assume that the amounts of the companys total variable expenses and total fixed expenses were reversed. In other words, assume that the total variable expenses are $8,680 and the total fixed expenses are $26,000. Using the degree of operating leverage, what is the estimated percent increase in net operating income of a 5% increase in unit sales? (Round your intermediate calculations and final answer to 2 decimal places.)

Required information [The following information applies to the questions displayed below.] Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Students also viewed these Accounting questions