Question

Miller Company’s contribution format income statement for the most recent month is shown below:

	Total			Per Unit
Sales (31,000 units)	$	279,000		$	9.00
Variable expenses		186,000			6.00
Contribution margin		93,000		$	3.00
Fixed expenses		46,000
Net operating income	$	47,000

Required:

(Consider each case independently):

1. What is the revised net operating income if unit sales increase by 14%?

2. What is the revised net operating income if the selling price decreases by $1.20 per unit and the number of units sold increases by 21%?

3. What is the revised net operating income if the selling price increases by $1.20 per unit, fixed expenses increase by $9,000, and the number of units sold decreases by 2%?

4. What is the revised net operating income if the selling price per unit increases by 10%, variable expenses increase by 20 cents per unit, and the number of units sold decreases by 15%?

Miller Company’s contribution format income statement for the most recent month is shown below:

	Total			Per Unit
Sales (31,000 units)	$	279,000		$	9.00
Variable expenses		186,000			6.00
Contribution margin		93,000		$	3.00
Fixed expenses		46,000
Net operating income	$	47,000

Required:

(Consider each case independently):

1. What is the revised net operating income if unit sales increase by 14%?

2. What is the revised net operating income if the selling price decreases by $1.20 per unit and the number of units sold increases by 21%?

3. What is the revised net operating income if the selling price increases by $1.20 per unit, fixed expenses increase by $9,000, and the number of units sold decreases by 2%?

4. What is the revised net operating income if the selling price per unit increases by 10%, variable expenses increase by 20 cents per unit, and the number of units sold decreases by 15%?

Miller Company’s contribution format income statement for the most recent month is shown below:

	Total			Per Unit
Sales (31,000 units)	$	279,000		$	9.00
Variable expenses		186,000			6.00
Contribution margin		93,000		$	3.00
Fixed expenses		46,000
Net operating income	$	47,000

Required:

(Consider each case independently):

1. What is the revised net operating income if unit sales increase by 14%?

2. What is the revised net operating income if the selling price decreases by $1.20 per unit and the number of units sold increases by 21%?

3. What is the revised net operating income if the selling price increases by $1.20 per unit, fixed expenses increase by $9,000, and the number of units sold decreases by 2%?

4. What is the revised net operating income if the selling price per unit increases by 10%, variable expenses increase by 20 cents per unit, and the number of units sold decreases by 15%?

1. Net Operating Income

2. Net Operating income

3. Net Operating income

4. Net Operating income

Answer 1