Exercise 6-13 Changes in Selling Price, Sales Volume, Variable Cost per Unit, and Total Fixed Costs [LO6-1, LO6-4]

Miller Companys contribution format income statement for the most recent month is shown below:

	Total			Per Unit
Sales (34,000 units)	$	272,000		$	8.00
Variable expenses		170,000			5.00
Contribution margin		102,000		$	3.00
Fixed expenses		41,000
Net operating income	$	61,000

Required:

(Consider each case independently):

1. What is the revised net operating income if unit sales increase by 18%?

2. What is the revised net operating income if the selling price decreases by $1.30 per unit and the number of units sold increases by 20%?

3. What is the revised net operating income if the selling price increases by $1.30 per unit, fixed expenses increase by $5,000, and the number of units sold decreases by 3%?

4. What is the revised net operating income if the selling price per unit increases by 10%, variable expenses increase by 20 cents per unit, and the number of units sold decreases by 14%?

1	Net Operating Income	x
2	Net Operating Income	x
3	Net Operating Income	x
4	Net Operating Income	x