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Brightwood Furniture provides the following financial data for a given period: Sales Amount ($) Per Unit ($) 150,000 Less Variable Expenses 90,000 25 15 Contribution Margin 60,000 10 Less Fixed Expenses 35,000 Net Income 25,000 a. What is the company's CM ratio? b. If quarterly sales increase by $5,200 and there is no change in fixed expenses, by how much would you expect quarterly net operating income to increase?

Brightwood Furniture provides the following financial data for a given period: Sales Amount ($) Per Unit ($) 150,000 Less Variable Expenses 90,000 25 15 Contribution Margin 60,000 10 Less Fixed Expenses 35,000 Net Income 25,000 a. What is the company's CM ratio? b. If quarterly sales increase by $5,200 and there is no change in fixed expenses, by how much would you expect quarterly net operating income to increase?

Excel Applications for Accounting Principles
Excel Applications for Accounting Principles
4th Edition
ISBN:9781111581565
Author:Gaylord N. Smith
Publisher:Gaylord N. Smith
Chapter22: Master Budget (master)
Section: Chapter Questions
Problem 5R: Suppose the company has just the opposite news and now expects unit sales for August, September, and...
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Brightwood Furniture provides the following financial data for a given period: Sales Amount ($) Per Unit ($) 150,000 Less Variable Expenses 90,000 25 15 Contribution Margin 60,000 10 Less Fixed Expenses 35,000 Net Income 25,000 a. What is the company's CM ratio? b. If quarterly sales increase by $5,200 and there is no change in fixed expenses, by how much would you expect quarterly net operating income to increase?
Transcribed Image Text:Brightwood Furniture provides the following financial data for a given period: Sales Amount ($) Per Unit ($) 150,000 Less Variable Expenses 90,000 25 15 Contribution Margin 60,000 10 Less Fixed Expenses 35,000 Net Income 25,000 a. What is the company's CM ratio? b. If quarterly sales increase by $5,200 and there is no change in fixed expenses, by how much would you expect quarterly net operating income to increase?
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