The income statement for Nyland Company for 2010 appears below.
Instructions
Answer the following independent questions and show computations using the contribution margin technique to support your answers:
1. What was the company's break-even point in sales dollars in 2010?
2. How many additional units would the company have had to sell in 2011 in order to earn net income of $30,000?
3. If the company is able to reduce variable costs by $2.50 per unit in 2011 and other costs and unit revenues remain unchanged, how many units will the company have to sell in order to earn a net income of $35,000?

Question

The income statement for Nyland Company for 2010 appears below.  
Instructions
Answer the following independent questions and show computations using the contribution margin technique to support your answers:
1. What was the company's break-even point in sales dollars in 2010?
2. How many additional units would the company have had to sell in 2011 in order to earn net income of $30,000?
3. If the company is able to reduce variable costs by $2.50 per unit in 2011 and other costs and unit revenues remain unchanged, how many units will the company have to sell in order to earn a net income of $35,000?

Quizplus · Accepted Answer

The Answer of The income statement for Nyland Company for 2010 appears below.  
Instructions
Answer the following independent questions and show computations using the contribution margin technique to support your answers:
1. What was the company's break-even point in sales dollars in 2010?
2. How many additional units would the company have had to sell in 2011 in order to earn net income of $30,000?
3. If the company is able to reduce variable costs by $2.50 per unit in 2011 and other costs and unit revenues remain unchanged, how many units will the company have to sell in order to earn a net income of $35,000?

The Income Statement for Nyland Company for 2010 Appears Below