Miller Company’s contribution format income statement for the most recent month is shown below: Total Per Unit Sales (42,000...

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Miller Company’s contribution format income statement for themost recent month is shown below:
Total Per Unit
Sales (42,000 units) $ 294,000 $ 7.00
Variable expenses 168,000 4.00
Contribution margin 126,000 $ 3.00
Fixed expenses 40,000
Net operating income $ 86,000
Required:
(Consider each case independently):
1. What is the revised net operating income if unit salesincrease by 14%?
2. What is the revised net operating income if the selling pricedecreases by $1.20 per unit and the number of units sold increasesby 20%?
3. What is the revised net operating income if the selling priceincreases by $1.20 per unit, fixed expenses increase by $7,000, andthe number of units sold decreases by 7%?
4. What is the revised net operating income if the selling priceper unit increases by 20%, variable expenses increase by 20 centsper unit, and the number of units sold decreases by 9%?

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4.1 Ratings (590 Votes)

1Revised Unit Sales 42000114 47880 Contribution Margin 478803 143640 Less Fixed Expenses 40000 Revised Net Operating Income 103640 2Selling Price per See Answer

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Miller Company’s contribution format income statement for themost recent month is shown below:TotalPer UnitSales (42,000 units)$294,000$7.00Variable expenses168,0004.00Contribution margin126,000$3.00Fixed expenses40,000Net operating income$86,000Required:(Consider each case independently):1. What is the revised net operating income if unit salesincrease by 14%?2. What is the revised net operating income if the selling pricedecreases by $1.20 per unit and the number of units sold increasesby 20%?3. What is the revised net operating income if the selling priceincreases by $1.20 per unit, fixed expenses increase by $7,000, andthe number of units sold decreases by 7%?4. What is the revised net operating income if the selling priceper unit increases by 20%, variable expenses increase by 20 centsper unit, and the number of units sold decreases by 9%?

	Total		Per Unit
Sales (42,000 units)	$	294,000	$	7.00
Variable expenses		168,000		4.00
Contribution margin		126,000	$	3.00
Fixed expenses		40,000
Net operating income	$	86,000