ullumber Markets imports and sells small bear-shaped piñatas. In planning for the coming year, the company’s owner is evaluating several scenarios. For each scenario under consideration, prepare a contribution margin income statement showing the anticipated operating income. Consider each scenario is applied independently to the original data. Last year’s income statement is as follows:     Total   Per Unit Sales revenue   $756,000   $21.00 Variable expenses   324,000   9.00 Contribution margin   432,000   $12.00 Fixed expenses   175,000     Operating income   $257,000     (a) The sales price increases by 10% and sales volume decreases by 6%. (Round per unit answers to 2 decimal places, e.g. 0.38.) Cullumber Markets Income Statement     Total   Per Unit Sales   $enter a dollar amount    $enter a dollar amount rounded to 2 decimal places  Variable expenses   enter a dollar amount   enter a dollar amount rounded to 2 decimal places Contribution margin   enter a total dollar amount   $enter a total dollar amount rounded to 2 decimal places

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Cullumber Markets imports and sells small bear-shaped piñatas. In planning for the coming year, the company’s owner is evaluating several scenarios. For each scenario under consideration, prepare a contribution margin income statement showing the anticipated operating income. Consider each scenario is applied independently to the original data. Last year’s income statement is as follows:

 

 

Total

 

Per Unit

Sales revenue

 

$756,000

 

$21.00

Variable expenses

 

324,000

 

9.00

Contribution margin

 

432,000

 

$12.00

Fixed expenses

 

175,000

 

 

Operating income

 

$257,000

 

 

(a)

The sales price increases by 10% and sales volume decreases by 6%. (Round per unit answers to 2 decimal places, e.g. 0.38.)

Cullumber Markets
Income Statement

 

 

Total

 

Per Unit

Sales

 

$enter a dollar amount 

 

$enter a dollar amount rounded to 2 decimal places 

Variable expenses

 

enter a dollar amount

 

enter a dollar amount rounded to 2 decimal places

Contribution margin

 

enter a total dollar amount

 

$enter a total dollar amount rounded to 2 decimal places 

Fixed expenses

 

enter a dollar amount

 

 

Operating income

 

$enter a total dollar amount 

 

 

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(b)

The sales price increases by 12% and variable cost per unit increases by 6%. (Round per unit answers to 2 decimal places, e.g. 0.38.)

Cullumber Markets
Income Statement

 

 

Total

 

Per Unit

Sales

 

$enter a dollar amount 

 

$enter a dollar amount rounded to 2 decimal places 

Variable expenses

 

enter a dollar amount

 

enter a dollar amount rounded to 2 decimal places

Contribution margin

 

enter a total dollar amount

 

$enter a total dollar amount rounded to 2 decimal places 

Fixed expenses

 

enter a dollar amount

 

 

Operating income

 

$enter a total dollar amount 

 

 

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(c)

The sales price decreases by 5% and sales volume increases by 15%. (Round per unit answers to 2 decimal places, e.g. 0.38.)

Cullumber Markets
Income Statement

 

 

Total

 

Per Unit

Sales

 

$enter a dollar amount 

 

$enter a dollar amount rounded to 2 decimal places 

Variable expenses

 

enter a dollar amount

 

enter a dollar amount rounded to 2 decimal places

Contribution margin

 

enter a total dollar amount

 

$enter a total dollar amount rounded to 2 decimal places 

Fixed expenses

 

enter a dollar amount

 

 

Operating income

 

$enter a total dollar amount 

 

 

eTextbook and Media

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(d)

Fixed expenses increase by $40,000. (Round per unit answers to 2 decimal places, e.g. 0.38.)

Cullumber Markets
Income Statement

 

 

Total

 

Per Unit

Sales

 

$enter a dollar amount 

 

$enter a dollar amount rounded to 2 decimal places 

Variable expenses

 

enter a dollar amount

 

enter a dollar amount rounded to 2 decimal places

Contribution margin

 

enter a total dollar amount

 

$enter a total dollar amount rounded to 2 decimal places 

Fixed expenses

 

enter a dollar amount

 

 

Operating income

 

$enter a total dollar amount 

 

 

eTextbook and Media

Save for Later

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(e)

The sales price increases by 12%, variable cost per unit increases by 15%, fixed expenses increase by $30,000, and sales volume decreases by 15%. (Round per unit answers to 2 decimal places, e.g. 0.38.)

Cullumber Markets
Income Statement

 

 

Total

 

Per Unit

Sales

 

$enter a dollar amount 

 

$enter a dollar amount rounded to 2 decimal places 

Variable expenses

 

enter a dollar amount

 

enter a dollar amount rounded to 2 decimal places

Contribution margin

 

enter a total dollar amount

 

$enter a total dollar amount rounded to 2 decimal places 

Fixed expenses

 

enter a dollar amount

 

 

Operating income

 

$enter a total dollar amount 

 

 

 

 



Question 13 of 13
-/7 E
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Current Attempt in Progress
Cullumber Markets imports and sells small bear-shaped piñatas. In planning for the coming year, the company's owner is evaluating
several scenarios. For each scenario under consideration, prepare a dontribution margin income statement showing the anticipated
operating income. Consider each scenario is applied independently to the original data. Last year's income statement is as follows:
Total
Per Unit
Šales revenue
$756,000
$21.00
Variable expenses
324,000
9.00
Contribution margin
432,000
$12.00
Fixed expenses
175,000
Operating income
$257,000
P Type here to search
o 留
Rain...
(8
Transcribed Image Text:Question 13 of 13 -/7 E View Policies Current Attempt in Progress Cullumber Markets imports and sells small bear-shaped piñatas. In planning for the coming year, the company's owner is evaluating several scenarios. For each scenario under consideration, prepare a dontribution margin income statement showing the anticipated operating income. Consider each scenario is applied independently to the original data. Last year's income statement is as follows: Total Per Unit Šales revenue $756,000 $21.00 Variable expenses 324,000 9.00 Contribution margin 432,000 $12.00 Fixed expenses 175,000 Operating income $257,000 P Type here to search o 留 Rain... (8
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