e) point is variable cost fixed cost gross margin contribution margin net operating income

If your formulas are correct, you should get the correct answers to the following questions. (a) What is the gross margin now? (b) What is the net operating income now? (c) What is the contribution margin now? Required information Chapter 3: Applying Excel (Algo) [LO3] The Chapter 3 Form worksheet is to be used to create your own worksheet version of Exhibit 311 in the text. Chapter 3: Applying Excel: Exercise (Algo) (Part 2 of 2) 1. Now change all of the dollar amounts in the data area of your worksheet so that it looks like this: 2. Suppose that sales are 21% higher as shown below: Enter this new data into your worksheet. Make sure you enter all of the new data - not just the sales. (a) What is the gross margin now? Enter this new data into your worksheet. Make sure you enter all of the new data - not just the sales. (a) What is the gross margin now? (b) What is the net operating income now? (c) What is the contribution margin now? (d) When sales increase by 21%, which of the following should also increase by 21% in a merchandising company? (You may selec more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.) Variable cost Fixed cost Gross margin Contribution margin Net operating income (e) When sales increase by 21%, which of the following should increase by more than 21% in a merchandising company? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer. Any boxes left with a question mark will be automatically graded as incorrect.) Variable cost Fixed cost EXHIBIT 1-7 Comparing Traditional and Contribution Format Income Statements for Merchandising Companies (all numbers are given) [o] "For a manufacturing company, the cost of goods sold would include some variable costs, such as direct materials. direct labor, and variable overhead, and some fixed costs, such as fixed manufacturing overhead Income statement formats for manufacturing companies will be explored in greater detail in a subsequent chapter. Costofgoodssold=meginninginventoryEnding CostofgoodsBeginningEndingsold=merchandise+Purchasesmerchandiseinventoryinventory=$7,000+$3,000$4,000=$5,000