Stonebraker Corporation has provided the following contribution format income statement. All questions concern situations that are within the relevant range.

Required:
a. If sales increase to 9,040 units, what would be the estimated increase in 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 19,200 units, what would be the estimated net operating income?
c. Estimate how many units must be sold to achieve a target profit of $26,100.

Question

Stonebraker Corporation has provided the following contribution format income statement. All questions concern situations that are within the relevant range.
  
Required:
a. If sales increase to 9,040 units, what would be the estimated increase in 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 19,200 units, what would be the estimated net operating income?
c. Estimate how many units must be sold to achieve a target profit of $26,100.

Quizplus · Accepted Answer

The Answer of Stonebraker Corporation has provided the following contribution format income statement. All questions concern situations that are within the relevant range.
  
Required:
a. If sales increase to 9,040 units, what would be the estimated increase in 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 19,200 units, what would be the estimated net operating income?
c. Estimate how many units must be sold to achieve a target profit of $26,100.

Stonebraker Corporation Has Provided the Following Contribution Format Income Statement