A company's flexible budget for 16,000 units of production showed total contribution margin of $76,800 and...
A company's flexible budget for 16,000 units of production showed total contribution margin of $76,800 and fixed costs, $36,000. The operating income expected if the company produces and sells 21,000 units is:
Homework Answers
Answer: $64,800
Explanation:
Contribution margin per units = $76800 / 16000 units = $4.8
Contribution margin at 21000 units = 21000 * $4.8 = $100,800
Operating Income = Contribution margin - Fixed cost
Operating Income = $100,800 - $36,000
Operating Income = $64,800
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