Shown here is an income statement in the traditional format for a firm with a sales volume of 7,500 units. Cost formulas also are shown:

Revenues	$	34,100
Cost of goods sold ($5,600 + $2.15/unit)		21,725
Gross profit	$	12,375
Operating expenses:
Selling ($1,170 + $0.10/unit)		1,920
Administration ($3,650 + $0.20/unit)		5,150
Operating income	$	5,305

Required:

a. Prepare an income statement in the contribution margin format.

Contribution Margin Income Statement
Revenue		$34,100
Variable expenses:
Cost of goods sold	$16,125
Selling expenses	750
Administrative expenses	1,500
Total variable expenses		18,375
Contribution margin		15,725
Fixed expenses:
Cost of goods sold	5,600
Selling expenses	1,170
Administrative expenses	3,650
Total fixed expenses		10,420
		$5,305

b. Calculate the contribution margin per unit and the contribution margin ratio. (Do not round intermediate calculations. Round contribution margin per unit to 2 decimal places.)

c-1. Calculate the firm's operating income (or loss) if the volume changed from 7,500 units to 11,250 units. (Do not round intermediate calculations.)

c-2. Calculate the firm's operating income (or loss) if the volume changed from 7,500 units to 3,750 units. (Do not round intermediate calculations.)

Refer to your answer to part a for total revenues of $34,100.

d-1. Calculate the firms operating income (or loss) if unit selling price and variable expenses per unit do not change and total revenues increase by $12,500. (Round intermediate calculations to 2 decimal places.)

d-2. Calculate the firm's operating income (or loss) if unit selling price and variable expenses per unit do not change and total revenues decrease by $3,500. (Round intermediate calculations to 2 decimal places.)