In: Accounting
Miller Company’s contribution format income statement for the most recent month is shown below:
Total | Per Unit | |||||
Sales (34,000 units) | $ | 238,000 | $ | 7.00 | ||
Variable expenses | 136,000 | 4.00 | ||||
Contribution margin | 102,000 | $ | 3.00 | |||
Fixed expenses | 47,000 | |||||
Net operating income | $ | 55,000 | ||||
Required:
(Consider each case independently):
1. What is the revised net operating income if unit sales increase by 11%?
2. What is the revised net operating income if the selling price decreases by $1.40 per unit and the number of units sold increases by 23%?
3. What is the revised net operating income if the selling price increases by $1.40 per unit, fixed expenses increase by $8,000, and the number of units sold decreases by 6%?
4. What is the revised net operating income if the selling price per unit increases by 20%, variable expenses increase by 20 cents per unit, and the number of units sold decreases by 12%?