Answer:
The net operating income should be $69,100 for 7,200 units.
Explanation:
Given,
Sales (6800) units - $306,000
Variable expense (6800) - 149,600
Contribution - 156,400 (Sales - Variable cost )
Less - Fixed Expense $96,500
Net operating Income - $59,900
Since, the sales and the variable expense is given for 6800 units. For computing the net operating income for 7200 units, it is important to calculate per unit price of both.
Per unit sales = Sales ÷ Number of units
= $306,000 ÷ 6800 units
= $45 per unit sale
Per unit variable expense = Variable expense ÷ Units
= 149,600 ÷ 6800 units
= 22 per unit expense.
Now, we can compute easily.
Sales = (7200 × $45) = $324,000
Less - Variable cost (7200 × $22) = 158,400
Contribution - $165,600
Less - Fixed expense - $ 96500
Net operating income - $69,100
The fixed expense would remain the same.
Thus, the net operating income should be $69,100 for 7,200 units.
