Whirly Corporation\'s contribution format income statement for the most recent m

Question

Whirly Corporation's contribution format income statement for the most recent month is shown below: Per Unit $ 33.00 19.00 $ 14.00 Total Sales (7,300 units) Variable expenses Contribution margin Fixed expenses Net operating income $ 240,900 138,700 102,200 55,500 $ 46,700 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 6,300 units? 1. Revised net operating income 2. Revised net operating income 3.Revised net operating income

Explanation / Answer

NOTE:Total fixed expenses and variable expenses per unit do not change with change in units.

Case 1 Case 2 Case 3 Sales (7300+90)*33=$243870 (7300-90)*33=$237930 (6300*33)=$207900 Variable expenses (7300+90)*19=$140410 (7300-90)*19=$136990 (6300*19)=$119700 Contribution margin $103460 $100940 $88200 Fixed expenses 55500 55500 55500 Revised net operating income $47960 $45440 $32700

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