PROBLEM 4. Cindy, Inc., sells a single product. The company's most recent income statement is given below. Sales (10,000 units) Less variable expenses Contribution margin Less fixed expenses P800,000 ( 440,000) 360,000 (180,000) P180,000 Operating income Requirements: 1. If 2,000 more units are sold, how much increase in profit is expected? 2. If sales volume increases by15 percent compute the new profit. 3. If the firm were able to increase its sales volume by 15 percent without a change in its selling price, variable costs, or fixed costs, would this change the breakeven point?

PROBLEM 4. Cindy, Inc., sells a single product. The company's most recent income statement is given below. Sales (10,000 units) Less variable expenses Contribution margin Less fixed expenses P800,000 ( 440,000) 360,000 (180,000) P180,000 Operating income Requirements: 1. If 2,000 more units are sold, how much increase in profit is expected? 2. If sales volume increases by15 percent compute the new profit. 3. If the firm were able to increase its sales volume by 15 percent without a change in its selling price, variable costs, or fixed costs, would this change the breakeven point?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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