CVP EXERCISE CHANGE IN COLUME AND COST Coffee Klatch is an espresso stand in a downtown office building. The average selling price of a cup of coffee is $1.49 and the average variable expense per cup is $0.36. The average fixed expense per month is $1,300. An average of 2,100 cups are sold each month. What is the CM Ratio for Coffee Klatch? Find CM Unit and CM Ratio Solution Changes Net Income due to change in Fixed Costs. Variable cost and Sales Volume Racing Bicycle Company Contribution Income Statement For the Month of June Sales (500 bytes) 250.000 Less: Variable expenses 150 000 Contribution margin 100.000 Less: Fixed expenses 80.000 Net operating income 20.000 SP/unit = $500 VC/unit $300 *NOTE: PLEASE USE THE ABOVE DATA TO COMPLETE ALL QUESTION BELOW Q1. What is the profit impact if Racing Bicycle can increase unit sales from 500 to 540 by increasing the monthly advertising budget by S10,000? Change in Variable Costs and Sales Volume Q2. What is the profit impact if Racing Bicycle can use higher quality raw materials, thus increasing variable costs per unit by S10, to generate an increase in unit sales from 500 to 580? Change in Fixed Cost, Sales Price, and Volume Q3. What is the profit impact if RBC: (1) cuts its selling price $20 per unit, (2) increases its advertising budget by $15,000 per month, and (3) increases sales from 500 to 650 units per month? Q4. What is the profit impact if RBC: (1) pays a $15 sales commission per bike sold instead of paying salespersons flat salaries that currently total $6,000 per month, and (2) increases unit sales from 500 to 575 bikes