Muzzillo Corporation has provided the following contribution format income statement. All questions concern situations that are within the relevant range.
Required:
a. If the selling price increases by $4 per unit and the sales volume decreases by 300 units, what would be the estimated net operating income?
b. If the variable cost per unit increases by $6, spending on advertising increases by $3,000, and unit sales increase by 1,800 units, what would be the estimated net operating income?

Question

Muzzillo Corporation has provided the following contribution format income statement. All questions concern situations that are within the relevant range.
  Required:
a. If the selling price increases by $4 per unit and the sales volume decreases by 300 units, what would be the estimated net operating income?
b. If the variable cost per unit increases by $6, spending on advertising increases by $3,000, and unit sales increase by 1,800 units, what would be the estimated net operating income?

Quizplus · Accepted Answer

The Answer of Muzzillo Corporation has provided the following contribution format income statement. All questions concern situations that are within the relevant range.
  Required:
a. If the selling price increases by $4 per unit and the sales volume decreases by 300 units, what would be the estimated net operating income?
b. If the variable cost per unit increases by $6, spending on advertising increases by $3,000, and unit sales increase by 1,800 units, what would be the estimated net operating income?

Muzzillo Corporation Has Provided the Following Contribution Format Income Statement