5-4 #1 & #2

EXERCISE 5-4 Computing and Using the CM Ratio [LOS-3 Last month when Holiday Creations, Inc., sold 50,000 units, total sales were $200,000, total variable expenses were $120,000, and fixed expenses were $65,000. TAKE TWO Required: 1. What is the company's contribution margin (CM) ratio? 2. Estimate the change in the company's net operating income if it were to increase its total sales by Total variable expenses = SI 10.000 $1,000