Whirly Corporation's contribution format Income statement for the most recent month is shown below: Total $ 228,eee 136, Bee 91,2ee 54,100 $ 37,1ee Per Unit $32.ee 18.ee $ 12.ee Sales (7,608 units) Variable expenses Contribution margin Fixed expenses Net operating income Required: (Consider each case independently 1. What would be the revised net operating income per month if the sales volume increases by 70 units? 2. What would be the revised net operating Income per month if the sales volume decreases by 70 units? 3. What would be the revised net operating income per month if the sales volume is 6,600 units? Revised net operating income 2. Revised net operating income 3. Revised net operating income Last month when Holiday Creations, Incorporated, sold 41,000 units, total sales were $164,000, total variable expenses were $127,920 and fixed expenses were $39300 Required: 1. What is the company's contribution margin (CM) ratio? 2 What is the estimated change in the company's net operating income if it can increase sales volume by 550 unts and total sales by $2,200? (Do not round Intermediate calculations.) 1 Contribution margin ratio 2. Estimated change in net operating income {The following information applies to the questions displayed below) Data for Hermann Corporation are shown below Selling price Variable expenses Contribution margin Percent Per Unit of Sales $ 140 100% 91 65 5.49 35% Fixed expenses are $88,000 per month and the company is selling 3,000 units per month Exercise 6-5 (Algo) Part 1 Required: 1-a. How much will net operating Income increase (decrease) per month of the monthly advertising budget Increases by S9,300, the monthly sales volume increases by 100 units, and the total monthly sales increase by $14,000? 1-6. Should the advertising budget be increased? Complete this question by entering your answers in the tabs below. Reg 1A Reg 1B How much will net operating income increase (decreate) per month if the monthly advertising budget increases by $9.300, the monthly sales volume increases by 100 units, and the total monthly sales increasy by $14,000? (Do not round Intermediate calculations.) Net oparting income DY RegiA Reg 1B > [The following information applies to the questions displayed below] Data for Hermann Corporation are shown below. Selling price Variable expenses Contribution margin Dercent Per Unit of Sales $ 140 100% 91 65 $ 49 35% Fixed expenses are $88,000 per month and the company is selling 3,000 units per month Exercise 6-5 (Algo) Part 1 Required: 1-a. How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $9,300, the monthly sales volume increases by 100 units, and the total monthly sales increase by $14,000? 1-b. Should the advertising budget be increased? Complete this question by entering your answers in the tabs below. Reg 1A Reg 1 Should the advertising budget be increased? Yes No Engberg Company Installs lawn sod in home yards. The company's most recent monthly contribution format Income statement follows: Amount 5 137,000 Percent of Sales 100% 82,200 60% Sales Variable expenses Contribution wargin Fixed expenses Net operating income $ 64,200 Required: 1. What is the company's degree of operating leverage? 2. Using the degree of operating leverage, estimate the impact on net operating income of a 14% increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 14% increase in unit sales. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 What is the company's degree of operating leverage? (Round your answer to 2 decimal places.) Degree of operating leverans Required 2 > Engberg Company installs lawn sod in home yards. The company's most recent monthly contribution format Income statement follows: Sales Variable expenses Contribution margin Fixed expenses Net operating income Amount $ 137,000 54,800 82,200 18, 5 64,200 Percent of Sales 3005 401 60% Required: 1. What is the company's degree of operating leverage? 2. Using the degree of operating leverage, estimate the impact on net operating income of a 14% increase in unit sales 3. Construct a new contribution format income statement for the company assuming a 14% increase in unlt sales. 1 Complete this question by entering your answers in the tabs below Required 1 Required 2 Required Using the degree of operating leverage estimate the impact on net operating income of a 14% increase in unit sales. (Round your intermediate calculations to 2 decimal places. Round your percentage answer to 2 decimal places (..1234 should be entered as 12.34).) Het operating income Required: 1. What is the company's degree of operating leverage? 2. Using the degree of operating leverage, estimate the impact on net operating income of a 14% Increase in unit sales. 3. Construct a new contribution format income statement for the company assuming a 14% Increase in unft sales Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Construct a new contribution format income statement for the company assuming a 14% increase in unit sales, Engberg Company Contribution Income Statement Amount Percent of Sales apter 6 Graded Homework 9 ents 3. Refer to the data in (2) above. If the expected change in vartable expenses takes place, how many balls will have to be solc year to earn the same net operating income, $109,000, as last year? 4. Refer again to the data in 2) above. The president feels that the company must raise the selling price of its basketballs. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement 18), what selling price pe must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant The new would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is bu would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating Income, $109,000, year? b. Assume the new plant is built and that next year the company manufactures and sells 32,000 balls (the same number as year). Prepare a contribution format Income statement and compute the degree of operating leverage. eBook Hint Complete this question by entering your answers in the tabs below. Print Reg 1 Reg 2 Reg 3 Reg 4 Reg 5 Reg 6A Reg 6B References Due to an increase labor rates, the company estimates that next year's variable expenses will increase by $3.00 per ball. IF this change takes place and the selling price per ball remains constant at $25.00. what will be next year's CM ratio and the break-even point in balls? {Round CM ratio to 2 decimal places and "Unit sales to break even to the nearest whole unit.) CM ratio Unit sales to break even balls point in balls? 3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold nex year to earn the same net operating income, $109,000, as last year? 4. Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketballs. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement 1a). what selling price per ball must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to ear the same net operating income. $109,000, as las year? b. Assume the new plant is built and that next year the company manufactures and sells 32,000 balls (the same number as sold year). Prepare a contribution format income statement and compute the degree of operating leverage Complete this question by entering your answers in the tabs below. ces Reg 1 Req 2 Redes Reg 4 Reg 5 Reg 6A Reg 68 Req3 Refer to the data in (2) above. If the change in variable expenses takes place, how many balls will have to be sold next year to earn the same net operating income, $109,000, as last year? (Round your answer to the nearest whole unit.) Number of bales point in balls? 3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold nex year to earn the same net operating Income, $109,000, as last year? 4. Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketballs. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement ta), what selling price per ball must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income $109,000, as las year? b. Assume the new plant is built and that next year the company manufactures and sells 32,000 balls (the same number as sold year). Prepare a contribution format Income statement and compute the degree of operating leverage Complete this question by entering your answers in the tabs below. Roda Reg 5 Reg 6A Reg 68 ces Reg 1 Reg2 Reg 4 Refer to the data in (2) above. If the need change in variable expenses takes place, how many balls will have to be sold Req3 next year to earn the same net operating income, 5109.000, as last year? (Round your answer to the nearest whole unit.) Number of bars 3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold n year to earn the same net operating income, $109,000, as last year? 4. Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketballs. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement 18), what selling price per b must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plar would slash vartable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $109.000, as year? b. Assume the new plant is built and that next year the company manufactures and sells 32,000 balls (the same number as som year, Prepare a contribution format Income statement and compute the degree of operating leverage Complete this question by entering your answers in the tabs below. Red GA Reg 60 ances Reg 1 Reg 2 Reg 3 Reg4 Reqs Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketbalis. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement 1a), what selling price per ball must it charge next year to cover the increased labor costs? (Round your answer to 2 decimal places.) Seting price 9 3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold year to earn the same net operating income, $109,000, as last year? 4. Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketballs. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement fa), what selling price per must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new p would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is bu would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating income. $109,000, year? b. Assume the new plant is built and that next year the company manufactures and sells 32.000 balls (the same number as year). Prepare a contribution format Income statement and compute the degree of operating leverage. re Complete this question by entering your answers in the tabs below. Tint Reg 1 Reg 2 Reg 3 Reg 4 Rods Req 6A Reg 68 rences Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new plant would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is built, what would be the company's new CM ratio and new break-even point in balls? (Round "CM ratio to 2 decimal places and unit sales to break even to the nearest whole unit.) Show less CM ratio Unit sales to break even balls point in balls? 3. Refer to the data in (2) above. If the expected change in variable expenses takes place, how many balls will have to be sold year to eam the same net operating income, $109,000, as last year? 4. Refer again to the data in (2) above. The president feels that the company must raise the selling price of its basketballs. If Northwood Company wants to maintain the same CM ratio as last year (as computed in requirement 1a). what selling price per E must it charge next year to cover the increased labor costs? 5. Refer to the original data. The company is discussing the construction of a new, automated manufacturing plant. The new pla would slash variable expenses per ball by 40.00%, but it would cause fixed expenses per year to double. If the new plant is bull would be the company's new CM ratio and new break-even point in balls? 6. Refer to the data in (5) above. a. If the new plant is bullt, how many balls will have to be sold next year to eam the same net operating Income, $109,000, as year? b. Assume the new plant is built and that next year the company manufactures and sells 32,000 balls (the same number as se year). Prepare a contribution format income statement and compute the degree of operating leverage. Complete this question by entering your answers in the tabs below. + Reg 1 Reg 2 Req3 Reg 4 Reg 5 Read Req 68 ces If the new plant is built, how many balls will have to be sold next year to earn the same net operating income, $109.000. as last year? (Round your answer to the nearest whole unit.) Number of balls 6. Refer to the data in (5) above. a. If the new plant is built, how many balls will have to be sold next year to earn the same net operating Income, $109,000, year? b. Assume the new plant is built and that next year the company manufactures and sells 32,000 balls (the same number as year). Prepare a contribution format Income statement and compute the degree of operating leverage. Complete this question by entering your answers in the tabs below. Reg 2 Rea 1 Reg 3 Reg 4 Reg 5 Req 6A Reg 6B Assume the new plant is built and that next year the company manufactures and sells 32,000 balls (the same number as sold last year). Prepare a contribution format income statement and compute the degree of operating leverage. (Round "Degree of operating leverage" to 2 decimal places.) 70 Northwood Company Contribution Income Statement inces ET Degree of operating leverage