PROBLEM 2

PERAYA Incorporated, which produces and sells a single product, has provided the following contribution format income statement for March:

Sales (5,000 units)=P 720,000

Variable expenses=180,000

Contribution margin=P 540,000

Fixed expenses=104,400

Net operating income=P 435,600

Please help me on these questions:

A. Contribution margin per unit =

B. Contribution margin ratio =

C. Proposed net operating income if sales increased by 1,500 units. =

D. Proposed net operating income is sales decreased by P 20,000.00 and fixed expense increased by P25,200.00 =

PROBLEM 3

Pertinent data at 1,500 units sold for SOTUS COMPANY follows:

Sales=P 60,000.00

Variable Expense=42,000.00

Contribution Margin=P 18,000.00

Fixed Expense=4,860.00

Net Operating Income=P 13,140.00

Please help me on these questions:

3.A

A. Break-even point in unit sales =

B. Break-even point in peso sales =

C. Degree of operating leverage =

3.B Using degree of operating leverage (complete, unrounded), solve for the following:

D. Peso increase in net operating income if sales increased by 20% =

E. Proposed net operating income if sales decreased by 15% =