Required

Requirement $1.($a$)$ What is the present operating income for a year?

Start by determining the formula to calculate operating income.

Required

$($Consider each case separately.$)$

a$.$ What is the present operating income for a year?

b$.$ What is the present breakeven point in revenue?

Compute the new operating income for each of the following

independent changes:

a$.$ A $$0\mathrm{.}08$ per unit increase in variable costs.

b$.$ A $10\%$ increase in fixed costs and a $10\%$ increase in units sold.

c$.$ A $30\%$ decrease in fixed costs, a $30\%$ decrease in selling price, a $20\%$

decrease in variable costs per unit, and a $45\%$ increase in units sold.

Compute the new breakeven point in units for each of the following changes:

a$.$ A $10\%$ increase in fixed costs.

b$.$ A $10\%$ increase in selling price and a $$40,000$ increase in fixed costs.