Question

3 Whirly Corporation's contribution format income statement for the most recent month is shown below: 25 oints Sales (9,000 units) Variable expenses Contribution margin Fixed expenses Net operating income Total $ 306,000 171,000 135,000 54,300 $ 80,700 Per Unit $ 34.00 19.00 $ 15.00 eBook Hint Required: (Consider each case independently): 1. What would be the revised net operating income per month if the sales volume increases by 40 units? 2. What would be the revised net operating income per month if the sales volume decreases by 40 units? 3. What would be the revised net operating income per month if the sales volume is 8,000 units? 1. Revised net operating income 2. Revised net operating income 3. Revised net operating income

Answer 1

solution 1:

Computation of revised net operating income
Particulars	Amount
Sales (9040*$34)	$307,360.00
Variable expenses (9040*$19)	$171,760.00
Contribution margin	$135,600.00
Fixed Expenses	$54,300.00
Net operating income	$81,300.00

Solution 2:

Computation of revised net operating income
Particulars	Amount
Sales (8960*$34)	$304,640.00
Variable expenses (8960*$19)	$170,240.00
Contribution margin	$134,400.00
Fixed Expenses	$54,300.00
Net operating income	$80,100.00

Solution 3:

Computation of revised net operating income
Particulars	Amount
Sales (8000*$34)	$272,000.00
Variable expenses (8000*$19)	$152,000.00
Contribution margin	$120,000.00
Fixed Expenses	$54,300.00
Net operating income	$65,700.00