Question
Stonebraker Corporation has provided the following contribution format income statement for sales of 9,000 units: Sales $270,000 Variable expenses $189,000 Contribution margin $81,000 Fixed expenses
Stonebraker Corporation has provided the following contribution format income statement for sales of 9,000 units:
Sales $270,000
Variable expenses $189,000
Contribution margin $81,000
Fixed expenses $77,400
Net operating income $3,600
Note: Each of these requirements is independent of the other two requirements.
1. If sales increase to 9,040 units, what would be the estimated increase in net operating income?
2. If the variable cost per unit increased by $6, spending on advertising increased by $3,000 and unit sales increase by 19,200 units, what would be the estimated net operating income?
3. Estimate how many units must be sold to achieve a target profit of $26,100.
Please show work/any formulas used especially for #3. Thank you!
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