Exercise 5-13 (Algo) Changes in Selling Price, Unit Sales, Variable Cost per Unit, and Total Fixed Costs LO5-2, LO5-3, LO5-7] Miller Company's contribution format income statement for the most recent month is shown below: Per Unit $9.00 5.40 $ 3.60 Sales (28,800 units) Variable expenses Contribution margin Fixed expenses Net operating income Total $ 259,200 155,520 103,680 60,480 $ 43,200 Required: Consider each of the four requirements independently): 1. Assume the sales volume increases by 4,608 units: a. What is the revised net operating income? b. What is the percent increase in unit sales? c. Using the most recent month's degree of operating leverage, what is the percent increase in net operating income? 2. What is the revised net operating income if the selling price decreases by $1.20 per unit and the number of units sold increases by 23%? 1a. Net operating income 1b. Percent increase in unit sales 3. What is the revised net operating income if the selling price increases by $1.20 per unit, fixed expenses increase by $7,000, and the number of units sold decreases by 5%? 4. What is the revised net operating income if the selling price per unit increases by 10%, variable expenses increase by 30 cents per unit, and the number of units sold decreases by 12%? 1c Percent increase in net operating income $ 59,789 16 % 38 %
Exercise 5-13 (Algo) Changes in Selling Price, Unit Sales, Variable Cost per Unit, and Total Fixed Costs LO5-2, LO5-3, LO5-7] Miller Company's contribution format income statement for the most recent month is shown below: Per Unit $9.00 5.40 $ 3.60 Sales (28,800 units) Variable expenses Contribution margin Fixed expenses Net operating income Total $ 259,200 155,520 103,680 60,480 $ 43,200 Required: Consider each of the four requirements independently): 1. Assume the sales volume increases by 4,608 units: a. What is the revised net operating income? b. What is the percent increase in unit sales? c. Using the most recent month's degree of operating leverage, what is the percent increase in net operating income? 2. What is the revised net operating income if the selling price decreases by $1.20 per unit and the number of units sold increases by 23%? 1a. Net operating income 1b. Percent increase in unit sales 3. What is the revised net operating income if the selling price increases by $1.20 per unit, fixed expenses increase by $7,000, and the number of units sold decreases by 5%? 4. What is the revised net operating income if the selling price per unit increases by 10%, variable expenses increase by 30 cents per unit, and the number of units sold decreases by 12%? 1c Percent increase in net operating income $ 59,789 16 % 38 %
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
8
![Exercise 5-13 (Algo) Changes in Selling Price, Unit Sales, Variable Cost per Unit, and Total Fixed Costs
[LO5-2, LO5-3, LO5-7]
Miller Company's contribution format income statement for the most recent month is shown below:
Per Unit
$9.00
5.40
$ 3.60
Sales (28,800 units)
Variable expenses
Contribution margin
Fixed expenses
Net operating income
Total
$ 259,200
155, 520
103,680
60,480
$ 43,200
Required:
(Consider each of the four requirements independently):
1. Assume the sales volume increases by 4,608 units:
a. What is the revised net operating income?
b. What is the percent increase in unit sales?
c. Using the most recent month's degree of operating leverage, what is the percent increase in net operating income?
2. What is the revised net operating income if the selling price decreases by $1.20 per unit and the number of units sold increases by
23%?
3. What is the revised net operating income if the selling price increases by $1.20 per unit, fixed expenses increase by $7,000, and the
number of units sold decreases by 5%?
4. What is the revised net operating income if the selling price per unit increases by 10%, variable expenses increase by 30 cents per
unit, and the number of units sold decreases by 12%?
1a. Net operating income
1b. Percent increase in unit sales
1c. Percent increase in net operating income
2. Net operating income (loss)
3. Net operating income
4. Net operating income
$
$
$
$
59,789
16 %
38 %
19,046
63,848
45,965](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb438be35-ec57-4431-aa8f-b6d299421846%2F128ab04a-3a91-4ffe-b3ce-07f9ad50f6fd%2F5nc7ct_processed.png&w=3840&q=75)
Transcribed Image Text:Exercise 5-13 (Algo) Changes in Selling Price, Unit Sales, Variable Cost per Unit, and Total Fixed Costs
[LO5-2, LO5-3, LO5-7]
Miller Company's contribution format income statement for the most recent month is shown below:
Per Unit
$9.00
5.40
$ 3.60
Sales (28,800 units)
Variable expenses
Contribution margin
Fixed expenses
Net operating income
Total
$ 259,200
155, 520
103,680
60,480
$ 43,200
Required:
(Consider each of the four requirements independently):
1. Assume the sales volume increases by 4,608 units:
a. What is the revised net operating income?
b. What is the percent increase in unit sales?
c. Using the most recent month's degree of operating leverage, what is the percent increase in net operating income?
2. What is the revised net operating income if the selling price decreases by $1.20 per unit and the number of units sold increases by
23%?
3. What is the revised net operating income if the selling price increases by $1.20 per unit, fixed expenses increase by $7,000, and the
number of units sold decreases by 5%?
4. What is the revised net operating income if the selling price per unit increases by 10%, variable expenses increase by 30 cents per
unit, and the number of units sold decreases by 12%?
1a. Net operating income
1b. Percent increase in unit sales
1c. Percent increase in net operating income
2. Net operating income (loss)
3. Net operating income
4. Net operating income
$
$
$
$
59,789
16 %
38 %
19,046
63,848
45,965
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