Increase in operating income is 80%.
Contribution | 150000 |
Operating Income | 15000 |
Fixed Cost (Balancing Figure) | 135000 |
Revised Contribution increase by 8% | 162000 |
Fixed Cost | 135000 |
Revised Operating Income | 27000 |
Increase in Operating Income | 12000 |
Increase in Operating Income in % | 80% |
Working Notes:
Note: IF Sales increase by 8%, then Contribution will also be increase by 8%. |
Note: Fixed Cost remain same, irrespecive of increase in sales. |
Assume the following (1) contribution margin = $150,000 (2) net operating income = $15,000, and (3)...
Given the following data: Average operating assets Total liabilities Sales Contribution margin Net operating income $512,000 $ 46,080 $384,000 $215,040 $ 46,080 Return on investment (ROI) is: o 12.0% o 9.0% o 56.0% BR Company has a contribution margin of 11%. Sales are $530,000, net operating Income is $58,300, and average operating assets are $137.000. What is the company's return on investment (ROI? Multiple Choice Ο Ο Ο Last year a company had sales of $370,000, a turnover of 2.6,...
Help S Sales (3,000 units) Variable expenses Contribution margin Fixed expenses Net operating income $60,000 42,000 18,000 13,200 $ 4,800 Using the degree of operating leverage, the estimated percent increase in net operating income as the result of a 20% increase in sales is closest to: (Round your intermediate calculations to 1 decimal place.) Multiple Choice 5.33% o 1609 75.00% o 250.00% The magnitude of operating leverage for RBG Corporation is 26 when sales are $180,000 and net income is...
Exercise 5-1 The Effect of Changes in Activity on Net Operating Income (LO5-1] Whirly Corporation's contribution format income statement for the most recent month is shown below: 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 Required: (Consider each case independently): 1. What would be the revised net operating income per month if the sales volume increases by 100 units? 2. What would be...
Check my wo Average operating assets Total liabilities Sales Contribution margin Net operating income $280,000 $ 33,600 $160,000 $ 89,600 $ 33,600 Return on Investment (ROI) is: Multiple Choice 210% O 0 56.0% O 32.0% O Prev | 1 of 20 Next > MacBook Air
1.What is the contribution margin per unit? 2.What is the contribution margin ratio? 3.What is the variable expense ratio? 4.If sales increase to 1,001 units, what would be the increase in net operating income? 5.If sales decline to 900 units, what would be the net operating income? 6.If the selling price increases by $2.50 per unit and the sales volume decreases by 100 units, what would be the net operating income? 7.If the variable cost per unit increases by $1.50,...
Assume the following (1) variable expenses = $315,000, (2) unit sales = 10,000, (3) the contribution margin ratio = 25%, and (4) net operating income = $10,000. Given these four assumptions, which of the following is true? A: The total fixed expenses = $78,750 B: The break-even point in sales dollars is $380,000 C: The total contribution margin = $236,250 D: The total sales = $393,750
ACCT 2301 Operating Leverage Handout #8 d cot ha Contribution margin income statements for two competing companies are provided below: Anthe Alpha Cempany Revenue Less variable costs Contribution margin Less fixed costs Net income Gamma Company $500,000 200.000 $300,000 270.000 $30,000 $500,000 350,000 $150,000 120.000 $30,000 Required: 1) Show each company's cost structure by inserting the percentage of the company's revenue represented by each item on the contribution income statement: Alpha Company $500,000 200,000 $300,000 Gemma Company $s00.000 350,000 $150,000...
Carver Packing Company reports total contribution margin of $72.000 and pretax net income of $24,000 for the current month. In the next month, the company expects sales volume to increase by 8%. The degree of operating leverage and the expected percent change in income, respectively, are: Multiple Choice O 3.0 and 8% 3.0 and 24% O 0.33 and 8% 0.33 and 2.7% O 4.0 and 32% Alvarez Company's break-even point in units is 1,700. The sales price per unit is...
Glven the following data: Average operating assets Total liabilities Sales Contribution margin $688,000 $103,200 $344,000 $196,080 $ 61,92 Net operating income 06 19 Return on investment (RO is: Multiple Choice 90% 570% 28 s%
Stockmaster Corporation has provided the following contribution format income statement. Assume that the following information is within the relevant range. Sales (8,000 units) Variable expenses Contribution margin Fixed expenses Net operating income $320,000 192,000 128,000 121,600 $ 6,400 The margin of safety in dollars is closest to: Multiple Choice $6,400 $16,000 $121,600