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Presented here is the income statement for Fairchild Co. for March: Sales $ 100,000 Cost of goods sold 54,000 Gross profit $ 46,000 Operating expenses
Presented here is the income statement for Fairchild Co. for March:
Sales | $ | 100,000 | |
Cost of goods sold | 54,000 | ||
Gross profit | $ | 46,000 | |
Operating expenses | 37,000 | ||
Operating income | $ | 9,000 | |
Based on an analysis of cost behavior patterns, it has been determined that the company's contribution margin ratio is 30%. Required:
- Rearrange the preceding income statement to the contribution margin format.
- Calculate operating income if sales volume increases by 10%.
- Calculate the amount of revenue required for Fairchild to break even.
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