Question

Required information (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 Variable expenses Contribution margin Fixed expenses Net operating income $ 65,000 45,500 19,500 14,840 $ 5,460 7. If the variable cost per unit increases by $1, spending on advertising increases by $1,550, and unit sales increase by 210 units, what would be the net operating income? Net operating income

Answer 1

7
Sales	78650	=1210*65
Variable expenses	56265	=1210*46.5
Contribution margin	22385
Fixed expenses	15590	=14040+1550
Net Operating income	6795
8
Fixed expenses	14040
Divide by Unit Contribution margin	19.5	=65-45.5
Break-even point	720	units
9
Break-even point	46800	=720*65