xAssignments: ACTG 2020xConnect e I https://newconnect.mheducation.com/flow/conn

Question

xAssignments: ACTG 2020xConnect e I https://newconnect.mheducation.com/flow/connect.html Saved Whirly Corporation's contribution format income statement for the most recent month is shown below: Sales (8,100 units) Variable expenses Contribution margin Fixed expenses Net operating income Per Unit S 267,30 33.00 153,919.68 113,400 14.80 55,509 s 57,900 Required: Consider each case independently): 1. What would be the revised net operating income per month if the seles volume increases by 50 units? 2 What would be the revised net operating income per month f the sales volume decreases by 50 units? 3. What would be the revised net operating income per month if the sales volume is 7100 units? 1 Revised net operating income 2. Revised net operating income 3 Revised net operating income EE Next>

Explanation / Answer

Rreq 1 Contribution margin per unit: $ 14 Additional sales 50 units Additional contribution: 50*14 = 700 No additional fixed cost Increase in net income is $ 700. Revised Net income= 57900+700 = 58600 Req 2: Contribution margin per unit: $ 14 Loss of sales 50 units Loss of contribution: 50 *14 =$ 700 No saving fixed cost Decrease in Net income: 700 Revised Net income: 57900-700 = 57200 Req 3 Contribution margin per unit: $ 14 loss of sales unit: 8100 -7100 = 1000 units Loss of contribution: 1000 *14 = 14000 Decrease in net incnome: 14000 Revised net income: 57900-14000 = 43900

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