Question
Miller Companys contribution format income statement for the most recent month is shown below: Total Per Unit Sales (20,000 units) $ 300,000 $ 15.00 Variable
Miller Companys contribution format income statement for the most recent month is shown below:
Total | Per Unit | ||||
Sales (20,000 units) | $ | 300,000 | $ | 15.00 | |
Variable expenses | 180,000 | 9.00 | |||
Contribution margin | 120,000 | $ | 6.00 | ||
Fixed expenses | 70,000 | ||||
Net operating income | $ | 50,000 | |||
Required:
(Consider each case independently):
1. What is the revised net operating income if unit sales increase by 15%?
2. What is the revised net operating income if the selling price decreases by $1.50 per unit and the number of units sold increases by 25%?
3. What is the revised net operating income if the selling price increases by $1.50 per unit, fixed expenses increase by $20,000, and the number of units sold decreases by 5%?
4. What is the revised net operating income if the selling price per unit increases by 12%, variable expenses increase by 60 cents per unit, and the number of units sold decreases by 10%?
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