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The following is Alsatia Corporation's contribution format income statement for last month: Sales $ 1,503,800 Variable expenses 854,900 Contribution margin 648,900 Fixed expenses 321,300 Net
The following is Alsatia Corporation's contribution format income statement for last month: |
Sales | $ | 1,503,800 |
Variable expenses | 854,900 | |
| | |
Contribution margin | 648,900 | |
Fixed expenses | 321,300 | |
| | |
Net operating income | $ | 327,600 |
| | |
|
The company has no beginning or ending inventories and produced and sold 10,300 units during the month. |
Required: | |
a. | What is the company's contribution margin ratio?(Round your answer to 3 decimal places.) |
Contribution margin ratio |
b. | What is the company's break-even in units? |
Break-even | units |
c. | If sales increase by 110 units, by how much should net operating income increase?(Omit the "$" sign in your response.) |
Increase in net operating income | $ |
d. | How many units would the company have to sell to attain target profits of $359,100? |
Sales to attain target profit | units |
e. | What is the companys margin of safety in dollars?(Omit the "$" sign in your response.) |
Margin of safety in dollars | $ |
f. | What is the company's degree of operating leverage?(Round your answer to 1 decimal place.) |
Degree of operating leverage |
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