Question

Whirly Corporation's contribution format income statement for the most recent month is shown below: points Sales (10,000 units) Variable expenses Contribution margin Fixed expenses Net operating income Total $ 350,000 200,000 150,000 135,000 $ 15,000 Per Unit $35.00 20.00 $15.00 Skipped eBook Hint Required: (Consider each case independently): Print References 1. What would be the revised net operating income per month if the sales volume increases by 100 units? 2. What would be the revised net operating income per month if the sales volume decreases by 100 units? 3. What would be the revised net operating income per month if the sales volume is 9,000 units? 1. Revised net operating income 2. Revised net operating income 3. Revised net operating income

Answer 1

	Case 1	Case 2	Case 3
Sales	10,100*$35 = $353,500	9,900*$35 = $346,500	9,000*$35 = $315,000
Less: Variable expenses	10,100*$20 = $202,000	9,900*$20 = $198,000	9,000*$20 = $180,000
Less: Fixed expenses	$                             135,000	$                          135,000	$                          135,000
Net operating income	$                               16,500	$                            13,500	$                                        -

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