A cement manufacturer has supplied the following data: Tons of cement produced and sold 220,000
Sales revenue ………………………..$924,000
Variable manufacturing expense …….$297,000
Fixed manufacturing expense ………..$280,000
Contribution Margin………………….$347,000
Variable selling and admin expense….$165,000
Fixed selling and admin expense ……...$82,000
Net operating income ………………..$100,000

Required:
a. Calculate the company's unit contribution margin
b. Calculate the company's unit contribution ratio
c. If the company increases its unit sales volume by 5% without increasing its fixed expenses, what would the company's net operating income be? 

$1.99

5

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May 12, 2012

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