Miller Company’s contribution format income statement for the most recent month is shown below: Total Per Unit Sales (33,000 units) $ 198,000 $ 6.00 Variable expenses 99,000 3.00 Contribution margin 99,000 $ 3.00 Fixed expenses 42,000 Net operating income $ 57,000 Required: (Consider each case independently): 1. What is the revised net operating income if unit sales increase by 15%? 2. What is the revised net operating income if the selling price decreases by $1.40 per unit and the number of units sold increases by 17%? 3. What is the revised net operating income if the selling price increases by $1.40 per unit, fixed expenses increase by $9,000, 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 20%, variable expenses increase by 40 cents per unit, and the number of units sold decreases by 8%?

Miller Company’s contribution format income statement for the most recent month is shown below: Total Per Unit Sales (33,000 units) $ 198,000 $ 6.00 Variable expenses 99,000 3.00 Contribution margin 99,000 $ 3.00 Fixed expenses 42,000 Net operating income $ 57,000 Required: (Consider each case independently): 1. What is the revised net operating income if unit sales increase by 15%? 2. What is the revised net operating income if the selling price decreases by $1.40 per unit and the number of units sold increases by 17%? 3. What is the revised net operating income if the selling price increases by $1.40 per unit, fixed expenses increase by $9,000, 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 20%, variable expenses increase by 40 cents per unit, and the number of units sold decreases by 8%?

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter11: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 11.16E

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Exercise 5-13 (Algo) Changes in Selling Price, Sales Volume, Variable Cost per Unit, and Total Fixed Costs [LO5-1, LO5-4]

Miller Company’s contribution format income statement for the most recent month is shown below:

	Total	Per Unit
Sales (33,000 units)	$ 198,000	$ 6.00
Variable expenses	99,000	3.00
Contribution margin	99,000	$ 3.00
Fixed expenses	42,000
Net operating income	$ 57,000

Required:

(Consider each case independently):

1. What is the revised net operating income if unit sales increase by 15%?

2. What is the revised net operating income if the selling price decreases by $1.40 per unit and the number of units sold increases by 17%?

3. What is the revised net operating income if the selling price increases by $1.40 per unit, fixed expenses increase by $9,000, 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 20%, variable expenses increase by 40 cents per unit, and the number of units sold decreases by 8%?

Exercise 5-13 (Algo) Changes in Selling Price, Sales Volume, Variable Cost per Unit,
and Total Fixed Costs [LO5-1, LO5-4]
Miller Company's contribution format income statement for the most recent month is shown below:
Total
Per Unit
$ 198,000
99,000
$ 6.00
Sales (33, 000 units)
Variable expenses
3.00
Contribution margin
99,000
$ 3.00
Fixed expenses
42,000
Net operating income
$ 57,000
Required:
(Consider each case independently):
1. What is the revised net operating income if unit sales increase by 15%?
2. What is the revised net operating income if the selling price decreases by $1.40 per unit and the number of
units sold increases by 17%?
3. What is the revised net operating income if the selling price increases by $1.40 per unit, fixed expenses
increase by $9,000, 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 20%, variable expenses
increase by 40 cents per unit, and the number of units sold decreases by 8%?
1. Net operating income
2. Net operating income
3. Net operating income
4. Net operating income

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