Question
Best Detroit Asphalt Inc.,a manufacturer of premium quality asphalt, has given you the following data as is requesting your help: Tons of asphaltproduced and sold
Best Detroit Asphalt Inc.,a manufacturer of premium quality asphalt, has given you the following data as is requesting your help:
Tons of asphaltproduced and sold ............................220,000
Sales revenue......................................................$924,000
Variable manufacturing expense .............................. $297,000
Fixed manufacturing expense .................................. $280,000
Variable selling and admin expense...........................$165,000
Fixed selling and admin expense................................ $82,000
Net operating income ............................................. $100,000
Required:
a. Calculate the company's unit contribution margin.
b. Calculate the company's unit contribution ratio.
c. If the company increases its unit sales volume by 5% without increasing its fixed expenses, what would the company's net operating income be?
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