Requirement 1. Compute the contribution margin of

Wharton

Men's Clothing.

Determine the formula to calculate the contribution margin, and then enter the amounts in the formula to compute the contribution margin of

Wharton

Men's Clothing.

=

Contribution margin

Part 2

=

Part 3

Requirement 2. Compute the contribution margin percentage.

Determine the formula to calculate the contribution margin percentage, then enter the amounts in the formula to compute the contribution margin percentage. (Enter the result as a whole percentage, XX%.)

=

Contribution margin percentage

Part 4

=

%

Part 5

Requirement 3. Mr.

Wharton

estimates that he can increase units sold, and hence revenues by

25%

by incurring additional advertising costs of

$10,000.

Calculate the impact of the additional advertising costs on operating income.

Determine the formula to solve for the amount then complete the formula.

=

Change in operating income

Part 6

=

Part 7

Requirement 4. What other actions can Mr.

Wharton

take to improve operating income?

To improve operating income, Mr.

Wharton

must find ways to

decrease variable costs, decrease fixed costs, or increase selling prices

decrease fixed costs, decrease selling prices, or variable costs must remain the same

.

harton Men's Clothing's revenues and cost data for 2021 are as follows: (Click the icon to view the data.) ry with sales volume, and $5,000 (fixed) costs. quired Requirements 1. Compute the contribution margin of Wharton Men's Clothing. compute the contribution margin of Wharton Men's 2. Compute the contribution margin percentage. 3. Mr. Wharton estimates that he can increase units sold and, hence, revenues by 25% by incurring additional advertising costs of $10,000. Calculate the impact of the additional advertising costs on operating income. 4. What other actions can Mr. Wharton take to improve operating income? nula to compute the contribution margin percentage. (Enter Data