Last month when Holiday Creations, Incorporated, sold 50,000 units, total sales were $200,000, total variable expenses were $120,000, and fixed expenses were $65,000. Required: 1. What is the company's contribution margin (CM) ratio? 2. What is the estimated change in the company's net operating income if it can increase sales volume by 250 units and total sales by $1,000? 1. Contribution margin ratio % 2. Estimated change in net operating incomeRequired information [The following information applies to the questions displayed below. ] Data for Hermann Corporation are shown below: Percent of Per Unit Sales Selling price $ 90 100% Variable expenses 63 70 Contribution margin $ 27 30% Fixed expenses are $30,000 per month and the company is selling 2,000 units per month. Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $5,000, the monthly sales volume increases by 100 units, and the total monthly sales increase by $9,000? 1b. Should the advertising budget be increased? How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $5,000, the monthly sales volume increases by 100 units, and the total monthly sales increase by $9,000? _:-:| \fRequired information [The following information applies to the questions displayed below] Data for Hermann Corporation are shown below: Percent of Per Unit Sales Selling price $ 90 100% Variable expenses 63 70 Contribution margin $ 27 30% Fixed expenses are $30,000 per month and the company is selling 2,000 units per month. \\. 4 23. Refer to the original data. How much will net operating income increase (decrease) per month ifthe company uses higherquality components that increase the variable expense by $2 per unit and increase unit sales by 10%. 2-b. Should the higher-quality components be used? Req 2A Req 2B Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher quality components that increase the variable expense by $2 per unit and increase unit sales by 10%. _:-:| \fMauro Products distributes a single product, a woven basket whose selling price is $11 per unit and whose variable expense is $9 per unit. The company's monthly xed expense is $4,600. Required: 1. Calculate the company's break-even point in unit sales. 2. Calculate the company's break-even point in dollar sales. (Do not round intermediate calculations.) 3. lfthe company's fixed expenses increase by $600, what would become the new break-even point in unit sales? In dollar sales? (Do not round intermediate calculations.) 1. Break-even point in unit sales 2. Breakeven point in dollar sales 3. Break-even point in unit sales 3. Breakeven point in dollar sales Lin Corporation has a single product whose selling price is $120 per unit and whose variable expense is $80 per unit. The company's monthly fixed expense is $50,000. Required: 1. Calculate the unit sales needed to attain a target profit of $10,000. 2. Calculate the dollar sales needed to attain a target profit of $15,000. (For all requirements, do not round intermediate calculations.) 1. Units sales to attain target prot -- 2. Dollar sales to attain target prot -- Molander Corporation is a distributor of a sun umbrella used at resort hotels. Data concerning the next month's budget appear below: Selling price per unit 5 30 Variable expense per unit $ 20 Fixed expense per month $ 7,500 Unit sales per month 1,000 Required: 1. What is the company's margin of safety? 2. What is the company's margin of safety as a percentage of its sales? 1. Margin of safety (in dollars) -- 2. Margin of safety percentage _ % Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format income statement follows: Percent of Amount sales Sales $ 80,000 100% Variable expenses 32,000 40% Contribution margin 48,000 50% Fixed expenses 38,000 Net operating income $ 101000 Required: 1. What is the company's degree of operating leverage? 2. Using the degree of operating leverage, estimate the impact on net operating income of a 5% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 5% increase in unit sales. Required 1 Required 2 Required 3 What is the company's degree of operating leverage? (Round your answer to 1 decimal place.) JU. ...................... U ' Using the degree of operating leverage, estimate the impact on net operating income of a 5% increase in unit sales. (Do not round intermediate calculations.) _- Construct a new contribution format income statement for the company assuming a 5% increase in unit sales. Lucido Products markets two computer games: Claimjumper and Makeover. A contribution format income statement for a recent month for the two games appears below: Claimjumper Makeover Total Sales $ 30,000 $ 70,000 $ 100,000 Variable expenses 20,000 50,000 70,000 Contribution margin 5 10:000 $ 20:000 30,000 Fixed expenses 24 , 000 Net operating income $ 6 , 000 Required: 1. What is the overall contribution margin (CM) ratio for the company? 2. What is the company's overall breakeven point in dollar sales? 3. Prepare a contribution format income statement at the company's breakeven point that shows the appropriate levels of sales for the two products. Required 1 Required 2 Required 3 What is the overall contribution margin (CM) ratio for the company? -% What is the company's overall break-even point in dollar sales? Overall break-even pointJuD_ ______________________ Prepare a contribution format income statement at the company's break-even point that shows the appropriate levels of sales for the two products. Whirly Corporation's contribution format income statement for the most recent month is shown below: Total Per Unit Sales (10,000 units) $ 350,000 $ 35.00 Variable expenses 200,000 20.00 Contribution margin 150,000 $ 15-00 Fixed expenses 135,000 Net Operating income $ 15:000 Required: (Consider each case independently): 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 9,000 units? 1. Revised net operating income 2. Revised net operating income 3. Revised net operating income