1 Whirly Corporation's contribution format income statement for the most recent month is shown below: Sales (8,300 units) Variable expenses Contribution margin Fixed expenses Net operating income Total $ 282, 280 157,700 124,500 55,400 $ 69,100 Per Unit $ 34.00 19.00 $ 15.00 eBook Hint Required: (Consider each case independently) Print 1. What would be the revised net operating income per month if the sales volume increases by 100 units? 2. What would be the revised net operating income per month if the sales volume decreases by 100 units? 3. What would be the revised net operating income per month if the sales volume is 7,300 units? 1. Revised net operating income 2. Revised net operating income 3. Revised net operating income $ 54,500 5 m. Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $15.00 per ball of which 60% is dire labor cost. Last year, the company sold 38,000 of these ballis, with the following results: eBook $ Print Sales (38,eee balls) variable expenses Contribution margin Fixed expenses Net operating income 950,000 570,000 38e, eee 264, coe 116, cee $ Required: 1. Compute (a) last year's CM ratio and the break-even point in balls, and (b) the degree of operating leverage at last year's sales level 2. Due to an increase in labor rates, the company estimates that next year's variable expenses will increase by $3.00 per ball. If this change takes place and the selling price per ball remains constant at $25.00, what will be next year's CM ratio and the break-even point in balls? 3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold next year to earn the same net operating income, $116,000, as last year? 4. Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketballs. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement ta). what selling price perball must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new.automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built what would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income. S116.000, as last year? b. Assume the new plant is built and that next year the company manufactures and sells 38.000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage. Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Rega Reg 5 Reg 6 Reg 68 Compute (a) last year's CM ratio and the break-even point in balls, and (b) the degree of operating leverage at last year's sales level. (Round "Unit sales to break even" to the nearest whole unit and other answers to 2 decimal places.) CM Ratio Unit sales to break even Degree of operating leverage 3 Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high totaling $15.00 per ball, of which 60% is direct labor cost. Last year, the company sold 38,000 of these balls, with the following results $ Book Sales (38,000 balls) variable expenses Contribution margin Fixed expenses Net operating income 950,000 570,000 300,000 264,000 116,000 Print $ Required: 1. Compute (a) last year's CM ratio and the break-even point in balls, and (b) the degree of operating leverage at last year's sales level 2. Due to an increase in labor rates, the company estimates that next year's variable expenses will increase by $3.00 per ball. If this change takes place and the selling price per ball remains constant at $25.00, what will be next year's CM ratio and the break-even point in balls? 3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold next year to earn the same net operating income, $116,000, as last year? 4. Refer again to the data in (2) above. The president feels that the company must raise the selling pnce of its basketballs. If Northwood Company wants to maintain the same CM ratio os last year (as computed in requirement ta), what selling price per ball must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00% but it would cause fixed expenses per year to double. If the new plant is built, what would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above, a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $116,000, as last year? b. Assume the new plant is built and that next year the company manufactures and sells 38.000 balls (the same number as sold last yean Prepare a contribution format income statement and compute the degree of operating leverage Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg Reg Regs Reg 6 Reg 68 Due to an increase in labor rates, the company estimates that next year's variable expenses will increase by $3.00 per ball. If this change takes place and the selling price per ball remains constant at $25.00, what will be next year's CM ratio and the break-even point in balls? (Round "CM Ratio to 2 decimal places and unit sales to break even to the nearest whole unit.) CM Ratio Un sales to break even bas 3 Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $15.00 per ball, of which 60% is direct labor cost. Last year, the company sold 38.000 of these balls with the following results: eBook $ Sales (38,eee balls) variable expenses Contribution margin Fixed expenses Net operating income 950, eee 570, eee 380, eee 264, eee 116, eee Print $ Required: 1. Compute (a) last year's CM ratio and the break-even point in balls, and (b) the degree of operating leverage at last year's sales level 2. Due to an increase in labor rates, the company estimates that next year's variable expenses will increase by $3.00 per ball. If this change takes place and the selling price per ball remains constant at $25.00, what will be next year's CM ratio and the break-even point in balls? 3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold next year to earn the same net operating Income. $116,000, as last year? 4. Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketballs. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement 1a). what selling price per ball must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $116,000, as last year? b. Assume the new plant is built and that next year the company manufactures and sells 38.000 balls (the same number as sold last year). Prepare a contribution format Income statement and compute the degree of operating leverage. Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Reg 4 Reg 5 Reg GA Reg 60 N Refer to the data in Required (2). If the expected change in variable expenses takes place, how many balls will have to be sold next year to earn the same net operating income, $116,000, as last year? (Round your answer to the nearest whole unit.) Number of balls 3 Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $15.00 per ball, of which 60% is direct labor cost Last year, the company sold 38,000 of these balls, with the following results: $ eBook sales (38,000 balls) Variable expenses Contribution margin Fixed expenses Net operating income 950, ce 57e,eee 38e, eee 264, eee 116,000 Print $ Required: 1. Compute (a) last year's CM ratio and the break-even point in balls, and (b) the degree of operating leverage at last year's sales level. 2. Due to an increase in labor rates, the company estimates that next year's variable expenses will increase by $3.00 per ball. If this change takes place and the selling price per ball remains constant at $25.00, what will be next year's CM ratio and the break-even point in balls? 3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold next year to earn the same net operating income, $116,000, as last year? 4. Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketballs. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement 1a). what selling price per ball must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $116,000, as last year? b. Assume the new plant is built and that next year the company manufactures and sells 38,000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Reg 4 Reqs Req 6A Reg 60 Refer again to the data in Required (2). The president feels that the company must raise the selling price of its basketballs. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement 1a), what selling price per ball must it charge next year to cover the increased labor costs? (Round your answer to 2 decimal places.) Selling price 3 Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $15.00 per ball, of which 60% is direct labor cost Last year, the company sold 38,000 of these balls, with the following results: eBook $ Sales (38,000 balls) Variable expenses Contribution margin Fixed expenses Net operating income 950, eee 570,000 380,eee 264,000 116,000 Print $ Required: 1. Compute (a) last year's CM ratio and the break-even point in balls, and (b) the degree of operating leverage at last year's sales level. 2. Due to an increase in labor rates, the company estimates that next year's variable expenses will increase by $3.00 per ball. If this change takes place and the selling price per ball remains constant at $25.00, what will be next year's CM ratio and the break-even point in balls? 3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold next year to earn the same net operating Income. $116,000, as last year? 4. Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketballs. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement ta). what selling price per ball 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double if the new plant is built, what would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $116,000, as last year? b. Assume the new plant is built and that next year the company manufactures and sells 38,000 balls the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Req Reg 5 Reg 6 Reg 68 Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company's new CM ratio and new break-even point in balls? (Round "CM Ratio" to 2 decimal places and Unitsales to break even" to the nearest whole unit.) Show less CM Ratio Und sales to break even balls 3 Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relles heavily on direct labor workers. Thus, variable expenses are high, totaling $15.00 per ball, of which 60% is direct labor cost. Last year, the company sold 38,000 of these balls, with the following results: Bock $ Sales (38,000 balls) Variable expenses Contribution margin Fixed expenses Net operating income 950, eee 570,000 380,eee 264,000 116, eee Prin: $ Required: 1. Compute (a) last year's CM ratio and the break-even point in balls, and (b) the degree of operating leverage at last year's sales level. 2. Due to an increase in labor rates, the company estimates that next year's variable expenses will increase by $3.00 per ball. If this change takes place and the selling price per ball remains constant at $25.00, what will be next year's CM ratio and the break-even point in balls? 3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold next year to earn the same net operating income, $116,000, as last year? 4. Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketballs. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement 18). what selling price per ball must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income. $116,000, as last year? b. Assume the new plant is built and that next year the company manufactures and sells 38.000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage. Complete this question by entering your answers in the tabs below. Real Reg 2 Reg Reg4 Reg 5 Re GA Reg 68 If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $116,000, as last year? (Round your answer to the nearest whole unit.) Number of balls 3. Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $15.00 per ball of which 60% is direct labor cost Last year, the company sold 38,000 of these balls, with the following results: " S Sales (38,0 balls) Variable expenses Contribution angin Fixed expenses Net operating income 950,ce 570.000 330.000 264.ee 110.000 Pront Required: 1. Compute follast year's CM ratio and the break-even point in balls, and (b) the degree of operating leverage at last year's soles level 2. Due to an increase in labor rates, the company estimates that next year's variable expenses will increase by $3.00 per ball. If this change takes place and the selling price per ball remains constant at $25.00, what will be next year's CM ond breskeven point in balls? 3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many bells will have to be sold next year to earn the same net operating income. $116,000, as last year? 4. Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketballs. Northwood Company wants to maintain the same CM ratio as last year (os computed in requirement fo, what selling price perball must it charge next year to cover the increased labor costa? 5. Refer to the original data. The company is discussing the construction of new, automated manufacturing plant. The new plent would slash variable expenses per bell by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built what would be the company's new CM ratio and new break-even point in balis? 6. Refer to the data in (5) above. 3. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $115.000. as last year? b. Assume the new plant is built and that next year the company manufactures and sells 38.000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage Complete this question by entering your answers in the tabs below. Reg Req2 Req3 Reg4 Reqs Reg 6 Reg 68 Assume the new plant is built and that next year the company manufactures and sells 38,000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage. (Round "Degree of operating leverage to 2 decimal places.) Northwood Company Contribution Income statement Denne og 3 Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $15.00 per ball, of which 60% is direct labor cost Last year, the company sold 38,000 of these balls, with the following results: eBook $ Sales (38,000 balls) Variable expenses Contribution margin Fixed expenses Net operating income 950, eee 570,000 380,eee 264,000 116,000 Print $ Required: 1. Compute (a) last year's CM ratio and the break-even point in balls, and (b) the degree of operating leverage at last year's sales level. 2. Due to an increase in labor rates, the company estimates that next year's variable expenses will increase by $3.00 per ball. If this change takes place and the selling price per ball remains constant at $25.00, what will be next year's CM ratio and the break-even point in balls? 3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold next year to earn the same net operating Income. $116,000, as last year? 4. Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketballs. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement ta). what selling price per ball 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double if the new plant is built, what would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $116,000, as last year? b. Assume the new plant is built and that next year the company manufactures and sells 38,000 balls the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage Complete this question by entering your answers in the tabs below. Reg 1 Reg 2 Reg 3 Req Reg 5 Reg 6 Reg 68 Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company's new CM ratio and new break-even point in balls? (Round "CM Ratio" to 2 decimal places and Unitsales to break even" to the nearest whole unit.) Show less CM Ratio Und sales to break even balls 3 Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relles heavily on direct labor workers. Thus, variable expenses are high, totaling $15.00 per ball, of which 60% is direct labor cost. Last year, the company sold 38,000 of these balls, with the following results: Bock $ Sales (38,000 balls) Variable expenses Contribution margin Fixed expenses Net operating income 950, eee 570,000 380,eee 264,000 116, eee Prin: $ Required: 1. Compute (a) last year's CM ratio and the break-even point in balls, and (b) the degree of operating leverage at last year's sales level. 2. Due to an increase in labor rates, the company estimates that next year's variable expenses will increase by $3.00 per ball. If this change takes place and the selling price per ball remains constant at $25.00, what will be next year's CM ratio and the break-even point in balls? 3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold next year to earn the same net operating income, $116,000, as last year? 4. Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketballs. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement 18). what selling price per ball must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income. $116,000, as last year? b. Assume the new plant is built and that next year the company manufactures and sells 38.000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage. Complete this question by entering your answers in the tabs below. Real Reg 2 Reg Reg4 Reg 5 Re GA Reg 68 If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $116,000, as last year? (Round your answer to the nearest whole unit.) Number of balls 3. Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $15.00 per ball of which 60% is direct labor cost Last year, the company sold 38,000 of these balls, with the following results: " S Sales (38,0 balls) Variable expenses Contribution angin Fixed expenses Net operating income 950,ce 570.000 330.000 264.ee 110.000 Pront Required: 1. Compute follast year's CM ratio and the break-even point in balls, and (b) the degree of operating leverage at last year's soles level 2. Due to an increase in labor rates, the company estimates that next year's variable expenses will increase by $3.00 per ball. If this change takes place and the selling price per ball remains constant at $25.00, what will be next year's CM ond breskeven point in balls? 3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many bells will have to be sold next year to earn the same net operating income. $116,000, as last year? 4. Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketballs. Northwood Company wants to maintain the same CM ratio as last year (os computed in requirement fo, what selling price perball must it charge next year to cover the increased labor costa? 5. Refer to the original data. The company is discussing the construction of new, automated manufacturing plant. The new plent would slash variable expenses per bell by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built what would be the company's new CM ratio and new break-even point in balis? 6. Refer to the data in (5) above. 3. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $115.000. as last year? b. Assume the new plant is built and that next year the company manufactures and sells 38.000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage Complete this question by entering your answers in the tabs below. Reg Req2 Req3 Reg4 Reqs Reg 6 Reg 68 Assume the new plant is built and that next year the company manufactures and sells 38,000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage. (Round "Degree of operating leverage to 2 decimal places.) Northwood Company Contribution Income statement Denne og