Question

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Whirly Corporation's most recent income statement is shown below. Sales (8,800 units) Variable expenses Total $ 272,800 167,200 Per Unit $31.00 19.00 $12.00 Contribution margin Fixed expenses 105,600 55,900 Net operating income $ 49,700 Required: Prepare a new contribution format income statement under each of the following conditions (consider each case independently): 1. The sales volume increases by 90 units. Whirly Corporation Contribution Income Statement Total Per Unit

Answer 1

Requirement: 1 Whirl Cororation Contribution Income statement Total Per Unit Sales (8890 * 31) 275590 Less: Variable cost ( 8890 * 19) 168910 Contribution Margin 106680 Less: Fixed expenses 55900 Revised Net operating income 50780 Requirement: 2 Whirl Cororation Contribution Income statement Total Per Unit Sales (8710 * 31) 270010 Less: Variable cost (8710 * 19) 1654901 19 Contribution Margin 1045201 12 Less: Fixed expenses 55900 Revised Net operating income 48620

Requirement: 3 Whirl Cororation Contribution Income statement Total Per Unit Sales (7800 *31) 2418001 Less: Variable cost (7800 * 19) 1482001 Contribution Margin 93600 12 Less: Fixed expenses 55900 Revised Net operating income 37700