Question
Miller Companys contribution format income statement for the most recent month is shown below: Total Per Unit Sales (44,000 units) $ 440,000 $ 10.00 Variable
Miller Companys contribution format income statement for the most recent month is shown below:
Total | Per Unit | |||||
Sales (44,000 units) | $ | 440,000 | $ | 10.00 | ||
Variable expenses | 308,000 | 7.00 | ||||
Contribution margin | 132,000 | $ | 3.00 | |||
Fixed expenses | 41,000 | |||||
Net operating income | $ | 91,000 | ||||
Required:
(Consider each case independently):
1. What is the revised net operating income if unit sales increase by 10%?
2. What is the revised net operating income if the selling price decreases by $1.40 per unit and the number of units sold increases by 21%?
3. What is the revised net operating income if the selling price increases by $1.40 per unit, fixed expenses increase by $5,000, 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 20%, variable expenses increase by 30 cents per unit, and the number of units sold decreases by 13%?
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