Question
Reavis Company prepared the following income statement for 2012: REAVIS COMPANY Income Statement For the Year Ended December 31, 2012 _____________________________________________________________________________ Sales (20,000 units) .............................................................................................
Reavis Company prepared the following income statement for 2012:
REAVIS COMPANY
Income Statement
For the Year Ended December 31, 2012
_____________________________________________________________________________
Sales (20,000 units) ............................................................................................. $600,000
Variable expenses ............................................................................................... 360,000
Contribution margin ............................................................................................ 240,000
Fixed expenses .................................................................................................... 180,000
Net income .......................................................................................................... $ 60,000
Instructions
What is the company's break-even point in units?
How many more units would the company have had to sell to earn net income of $90,000 in 2012?
If the company expects a 25% increase in sales volume in 2013, what would be the expected net income in 2013?
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