Question

Whirly Corporation’s contribution format income statement for the most recent month is shown below:

	Total			Per Unit
Sales (7,600 units)	$	235,600		$	31.00
Variable expenses		144,400			19.00
Contribution margin		91,200		$	12.00
Fixed expenses		54,800
Net operating income	$	36,400

Required:

(Consider each case independently):

1. What would be the revised net operating income per month if the sales volume increases by 90 units?

2. What would be the revised net operating income per month if the sales volume decreases by 90 units?

3. What would be the revised net operating income per month if the sales volume is 6,600 units?

Answer 1