Question

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

Total | Per Unit | |||||

Sales (40,000 units) | $ | 280,000 | $ | 7.00 | ||

Variable expenses | 160,000 | 4.00 | ||||

Contribution margin | 120,000 | $ | 3.00 | |||

Fixed expenses | 43,000 | |||||

Net operating income | $ | 77,000 | ||||

**Required:**

(Consider each case independently):

1. What is the revised net operating income if unit sales increase by 12%?

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 $5,000, and the number of units sold decreases by 7%?

4. What is the revised net operating income if the selling price per unit increases by 10%, variable expenses increase by 40 cents per unit, and the number of units sold decreases by 14%?

Answer #1

1 | ||

Total | Per unit | |

Sales (44,800 units) | 313600 | 7 |

Variable expenses | 179200 | 4 |

Contribution margin | 134400 | 3 |

Fixed expenses | 43000 | |

Revised net operating income | 91400 | |

2 | ||

Total | Per unit | |

Sales (48,400 units) | 280720 | 5.8 |

Variable expenses | 193600 | 4 |

Contribution margin | 87120 | 1.8 |

Fixed expenses | 43000 | |

Revised net operating income | 44120 | |

3 | ||

Total | Per unit | |

Sales (37,200 units) | 305040 | 8.2 |

Variable expenses | 148800 | 4 |

Contribution margin | 156240 | 4.2 |

Fixed expenses | 48000 | |

Revised net operating income | 108240 | |

4 | ||

Total | Per unit | |

Sales (34,400 units) | 264880 | 7.7 |

Variable expenses | 151360 | 4.4 |

Contribution margin | 113520 | 3.3 |

Fixed expenses | 43000 | |

Revised net operating income | 70520 |

Miller Company’s contribution format income statement for the
most recent month is shown below:
Total
Per Unit
Sales (43,000 units)
$
344,000
$
8.00
Variable expenses
215,000
5.00
Contribution margin
129,000
$
3.00
Fixed expenses
44,000
Net operating income
$
85,000
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...

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...

Miller Company’s contribution format income statement for the
most recent month is shown below:
Total
Per Unit
Sales (34,000 units)
$
170,000
$
5.00
Variable expenses
68,000
2.00
Contribution margin
102,000
$
3.00
Fixed expenses
48,000
Net operating income
$
54,000
Required:
(Consider each case independently):
1. What is the revised net operating income if unit sales
increase by 13%?
2. What is the revised net operating income if the selling price
decreases by $1.20 per unit and the number...

Miller Company’s contribution format income statement for the
most recent month is shown below:
Total
Per Unit
Sales (43,000 units)
$
215,000
$
5.00
Variable expenses
86,000
2.00
Contribution margin
129,000
$
3.00
Fixed expenses
45,000
Net operating income
$
84,000
Required:
(Consider each case independently):
1. What is the revised net operating income if unit sales
increase by 18%?
2. What is the revised net operating income if the selling price
decreases by $1.10 per unit and the number...

Miller Company’s contribution format income statement for the
most recent month is shown below:
Total
Per Unit
Sales (33,000 units)
$
297,000
$
9.00
Variable expenses
198,000
6.00
Contribution margin
99,000
$
3.00
Fixed expenses
43,000
Net operating income
$
56,000
Required:
(Consider each case independently):
1. What is the revised net operating income if unit sales
increase by 16%?
2. What is the revised net operating income if the selling price
decreases by $1.40 per unit and the number...

Miller Company’s contribution format income statement for the
most recent month is shown below:
Total
Per Unit
Sales (35,000 units)
$
175,000
$
5.00
Variable expenses
70,000
2.00
Contribution margin
105,000
$
3.00
Fixed expenses
45,000
Net operating income
$
60,000
1. 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 8%?
2. What is the revised net operating income...

Miller Company’s contribution format income statement for the
most recent month is shown below:
Total
Per Unit
Sales (42,000 units)
$
252,000
$
6.00
Variable expenses
126,000
3.00
Contribution margin
126,000
$
3.00
Fixed expenses
46,000
Net operating income
$
80,000
Required:
(Consider each case independently):
1. What is the revised net operating income if unit sales
increase by 18%?
2. What is the revised net operating income if the selling price
decreases by $1.30 per unit and the number...

Miller Company’s contribution format income statement for the
most recent month is shown below: Total Per Unit Sales (44,000
units) $ 352,000 $ 8.00 Variable expenses 220,000 5.00 Contribution
margin 132,000 $ 3.00 Fixed expenses 46,000 Net operating income $
86,000 Required: (Consider each case independently): 1. What is the
revised net operating income if unit sales increase by 12%? 2. What
is the revised net operating income if the selling price decreases
by $1.50 per unit and the number...

Miller Company’s contribution format income statement for the
most recent month is shown below: Total Per Unit Sales (41,000
units) $ 246,000 $ 6.00 Variable expenses 123,000 3.00 Contribution
margin 123,000 $ 3.00 Fixed expenses 44,000 Net operating income $
79,000 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 $1.10 per unit and the number...

Miller Company’s contribution format income statement for the
most recent month is shown below: Total Per Unit Sales (31,000
units) $ 155,000 $ 5.00 Variable expenses 62,000 2.00 Contribution
margin 93,000 $ 3.00 Fixed expenses 47,000 Net operating income $
46,000 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 $1.10 per unit and the number...

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