Question: Exercise 6-4 Computing and Using the CM Ratio [LO6-3] Last month when Holiday Creations, Inc., sold 42,000 units, total sales were $297,000, total variable expenses

Exercise 6-4 Computing and Using the CM Ratio [LO6-3]

Last month when Holiday Creations, Inc., sold 42,000 units, total sales were $297,000, total variable expenses were $207,900, and fixed expenses were $36,800.

Required:

1. What is the companys contribution margin (CM) ratio?

2. What is the estimated change in the companys net operating income if it can increase total sales by $2,400? (Do not round intermediate calculations.)

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