[The following information applies to the questions displayed below.] Oslo Compa

Question

[The following information applies to the questions displayed below.] Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units): Sales $ 22,100 Variable expenses 12,700 Contribution margin 9,400 Fixed expenses 7,708 Net operating income $ 1,692 If the selling price increases by $1.80 per unit and the sales volume decreases by 100 units, what would be the net operating income? (Do not round intermediate calculations.)

Explanation / Answer

present selling price =$22100/1000=22.1

if selling price uncreased by $1.80

new selling price will be =22.1+1.8=23.9

if sales volume decrease by 100 unit then sale price will be =23.9*900=$21510

so operating income will be=21510-(12700+7708)

=21510-20408

=$1102

net operating income will be $1102

Related Questions

Navigate

• Browse (All)
• Browse #
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.