Question & Answer: Whirly Corporation's most recent income statement is shown below: Prepare a new contribution format income…..

Whirly Corporations most recent income statement is shown below: Sales (10,000 units) Variable expenses Total Per Unit $350,000 $35.00 200,000 20.00 Contribution margin Fixed expenses 150,000 15.00 135,000 Net operating income $ 15,000 Required Prepare a new contribution format income statement under each of the following conditions (consider each case independently) a. The sales volume increases by 100 units. Whirly Corporation Contribution Income Statement Total Per Unit b. The sales volume decreases by 100 units. Whirly Corporation Total Contribution Income Statement Per Unit c. The sales volume is 9,000 units Whirly Corporation Contribution Income Statement Total Per Unit

Whirly Corporation’s most recent income statement is shown below: Prepare a new contribution format income statement under each of the following conditions (consider each case independently): a. The sales volume increases by 100 units. b. The sales volume decreases by 100 units. The sales volume is 9,000 units.

Expert Answer

 

a.

Total Per Unit
10100 Unit
Sales 353,500 35
Less : Variable Expenses 202,000 20
Contribution Margin 151,500 15
Less :Fixed Expenses 135,000
Net Operating Income 16,500

b.

Total Per Unit
9900 Unit
Sales 346,500 35
Less : Variable Expenses 198,000 20
Contribution Margin 148,500 15
Less :Fixed Expenses 135,000
Net Operating Income 13,500

c.

Total Per Unit
9000 Unit
Sales 315,000 35
Less : Variable Expenses 180,000 20
Contribution Margin 135,000 15
Less :Fixed Expenses 135,000
Net Operating Income
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