1. Ofarrell Corporation, a company that produces and sells a single product, has provided its contribution format...
Question:
1. Ofarrell Corporation, a company that produces and sells a single product, has provided its contribution format income statement for March.
Sales (6,500 units) $442,000
Variable expenses 312,000
Contribution margin 130,000
Fixed expenses 103,500
Net operating income $26,500
If the company sells 6,400 units, its net operating income should be closest to:
$26,500
$25,979
$22,000
$24,500
2. Maack Corporation's contribution margin ratio is 18% and its fixed monthly expenses are $52,000. If the company's sales for a month are $315,000, what is the best estimate of the company's net operating income? Assume that the fixed monthly expenses do not change.
$206,300
$4,700
$263,000
$56,700
3. Arthur Corporation has a margin of safety percentage of 25% based on its actual sales. The break-even point is $346,800 and the variable expenses are 45% of sales. Given this information, the actual profit is: (Do not round your intermediate calculations.)
$92,480
$63,580
$17,340
$47,685
Basic Business Statistics Concepts and Applications
ISBN: 978-0132168380
12th edition
Authors: Mark L. Berenson, David M. Levine, Timothy C. Krehbiel