The following is ABC Corporation's contribution format income statement for last month: Sales $1,200,000 Less variable expenses
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Question:
The following is ABC Corporation's contribution format income statement for last month:
Sales | $1,200,000 |
Less variable expenses | 800,000 |
Contribution margin | 400,000 |
Less fixed expenses | 300,000 |
Net income | $100,000 |
The company has no beginning or ending inventories and produced and sold 20,000 units during the month.
Required:
c. If sales increase by 100 units, by how much should net income increase?
d. How many units would the company have to sell to attain target profits of $125,000?
e. What is the company's margin of safety in dollars?
Related Book For
Managerial accounting
ISBN: 9780073526706
12th Edition
Authors: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer
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