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Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000...

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Accounting

Oslo Company prepared the following contribution format incomestatement based on a sales volume of 1,000 units (the relevantrange of production is 500 units to 1,500 units):

Sales$100,000
Variableexpenses65,000
Contribution margin35,000
Fixedexpenses30,100
Netoperating income$4,900

6a. If the selling price increases by $2 per unit and the salesvolume decreases by 100 units, what would be the net operatingincome?

6b. If the variable cost per unit increases by $1, spending onadvertising increases by $1,900, and unit sales increase by 280units, what would be the net operating income?

6c. What is the break-even point in unit sales?

6d. What is the break-even point in dollar sales?

Answer & Explanation Solved by verified expert
4.1 Ratings (778 Votes)
Sales 100000 Variable Expenses 65000 Number of units sold 1000 Selling Price per unit Sales Number of units sold Selling Price per unit 100000 1000 Selling Price per unit 100 Variable Costs per unit Variable Expenses Number of units sold Variable Costs per unit 65000 1000    See Answer
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Transcribed Image Text

Oslo Company prepared the following contribution format incomestatement based on a sales volume of 1,000 units (the relevantrange of production is 500 units to 1,500 units):Sales$100,000Variableexpenses65,000Contribution margin35,000Fixedexpenses30,100Netoperating income$4,9006a. If the selling price increases by $2 per unit and the salesvolume decreases by 100 units, what would be the net operatingincome?6b. If the variable cost per unit increases by $1, spending onadvertising increases by $1,900, and unit sales increase by 280units, what would be the net operating income?6c. What is the break-even point in unit sales?6d. What is the break-even point in dollar sales?

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