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Miller Company s contribution format income statement for the most recent month is shown below: Total Per Unit Sales ( 2 7 , 6 0

Miller Companys contribution format income statement for the most recent month is shown below:

Total Per Unit

Sales (27,600 units) $ 248,400 $ 9.00

Variable expenses 149,0405.40

Contribution margin 99,360 $ 3.60

Fixed expenses 57,960

Net operating income $ 41,400

Required:

(Consider each of the four requirements independently):

Assume the sales volume increases by 4,416 units:

What is the revised net operating income?

What is the percent increase in unit sales?

Using the most recent months degree of operating leverage, what is the percent increase in net operating income?

What is the revised net operating income if the selling price decreases by $1.20 per unit and the number of units sold increases by 23%?

What is the revised net operating income if the selling price increases by $1.20 per unit, fixed expenses increase by $6,000, and the number of units sold decreases by 7%?

What is the revised net operating income if the selling price per unit increases by 10%, variable expenses increase by 20 cents per unit, and the number of units sold decreases by 14%?


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1 Assume the sales volume increases by 4416 units Revised Sales 27600 4416 900 288144 Revised Variable Expenses 27600 4416 540 173232 Revised Contribu... blur-text-image

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