Question

Miller Company’s contribution format income statement for the most recent month is shown below: Total Per Unit Sales (31,000 units) $ 186,000 $ 6.00 Variable expenses 93,000 3.00 Contribution margin 93,000 $ 3.00 Fixed expenses 49,000 Net operating income $ 44,000 Required: (Consider each case independently):

1. What is the revised net operating income if unit sales increase by 19%?

2. What is the revised net operating income if the selling price decreases by $1.50 per unit and the number of units sold increases by 20%?

3. What is the revised net operating income if the selling price increases by $1.50 per unit, fixed expenses increase by $8,000, and the number of units sold decreases by 5%?

4. What is the revised net operating income if the selling price per unit increases by 20%, variable expenses increase by 30 cents per unit, and the number of units sold decreases by 8%?

Answer 1