chapter 6 - [The following information applies to the questions displayed below Whirly Corporation's most recent income statement is shown below Total

# chapter 6 - [The following information applies to the...

This preview shows page 1 - 6 out of 20 pages.

[The following information applies to the questions displayed below.] Whirly Corporation's most recent income statement is shown below: Total Per Unit Sales (7,900 units) \$205,400 \$26.00 Variable expenses 142,200 18.00 Contribution margin 63,200 \$8.00 Fixed expenses 54,800 Net operating income \$8,400 Prepare a new contribution format income statement under each of the following conditions (consider each case independently): 1. award: 1 out of 1 point Requirement 1: The sales volume increases by 100 units. (Input all amounts as positive values. Round your per unit values to 2 decimal places. Omit the "\$" sign in your response.) Total Per Unit Sales \$208,000 \$26.00 Variable expenses 144,000 18.00 Contribution margin 64,000 \$8.00 Fixed expenses 54,800 Net operating income \$9,200 eBook Link
Worksheet Difficulty: Basic Learning Objective: 06-1 Requirement 1: The sales volume increases by 100 units. (Input all amounts as positive values. Round your per unit values to 2 decimal places. Omit the "\$" sign in your response.) Total Per Unit Sales \$ \$ Variable expenses Contribution margin \$ Fixed expenses Net operating income \$ Explanation: Sales (8,000 × \$26.00) = \$208,000 You can get the same net operating income using the following approach. Original net operating income \$8,400 Change in contribution margin (100 units × \$8.00 per unit) 800 New net operating income \$9,200 2. award: 1 out of 1 point
Requirement 2: The sales volume decreases by 100 units. (Input all amounts as positive values. Round your per unit values to 2 decimal places. Omit the "\$" sign in your response.) Total Per Unit Sales \$202,800 \$26.00 Variable expenses 140,400 18.00 Contribution margin 62,400 \$8.00 Fixed expenses 54,800 Net operating income \$7,600 eBook Link Worksheet Difficulty: Basic Learning Objective: 06-1 Requirement 2: The sales volume decreases by 100 units. (Input all amounts as positive values. Round your per unit values to 2 decimal places. Omit the "\$" sign in your response.) Total Per Unit Sales \$ \$ Variable expenses Contribution margin \$ Fixed expenses Net operating income \$ Explanation: Sales (7,800 × \$26.00) = \$202,800 You can get the same net operating income using the following approach. Original net operating income \$8,400
Change in contribution margin (-100 units × \$8.00 per unit) (800) New net operating income \$7,600 3. award: 1 out of 1 point Requirement 3: The sales volume is 6,900 units. (Input all amounts as positive values. Round your per unit values to 2 decimal places. Omit the "\$" sign in your response.) Total Per Unit Sales \$179,400 \$26.00 Variable expenses 124,200 18.00 Contribution margin 55,200 \$8.00 Fixed expenses 54,800 Net operating income \$400 eBook Link Worksheet Difficulty: Basic Learning Objective: 06-1 Requirement 3: The sales volume is 6,900 units. (Input all amounts as positive values. Round your per unit values to 2 decimal places. Omit the "\$" sign in your response.) Total Per Unit Sales \$ \$ Variable expenses Contribution margin \$
Fixed expenses Net operating income \$ Explanation: Sales (6,900 × \$26.00) = \$179,400 Karlik Enterprises distributes a single product whose selling price is \$24 and whose variable expense is \$18 per unit. The company's monthly fixed expense is \$24,000.

#### You've reached the end of your free preview.

Want to read all 20 pages?

• Fall '09
• KIMTARANTINO