Problem 3 Glass Inc. has the following information for August 2015: Selling pric
ID: 2454124 • Letter: P
Question
Problem 3
Glass Inc. has the following information for August 2015:
Selling price
$ 27
per unit
Variable expenses
$ 18
per unit
Fixed expenses
$ 8,010
per month
Actual Units Sold
1,040
Required:
Prepare a Contribution Income Statement with the data provided.
If they spend an extra $1,000 a month in advertising, sales will increase by 100 units. Prepare a new Contribution Income Statement. Would their operating income increase or decrease?
If they decrease the selling price from $27 to $23, sales volume would increase by 50%. Prepare a new Contribution Income Statement. Would their operating income increase or decrease?
-Must show all calculations
Selling price
$ 27
per unit
Variable expenses
$ 18
per unit
Fixed expenses
$ 8,010
per month
Actual Units Sold
1,040
Explanation / Answer
Problem 3 Glass Inc. has the following information for August 2015: Selling pric
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