Answer:
Whirly Corporation
1. Revised net operating income per month if the sales volume increases by 70 units:
Whirly Corporation’s contribution format income statement for the most recent month is shown below:
Total Per Unit
Sales (7,470 units) $ 253,980 $ 34.00
Variable expenses 141,930 19.00
Contribution margin 112,050 $ 15.00
Fixed expenses 55,100
Net operating income $ 56,950
2. Revised net operating income per month if the sales volume decreases by 70 units:
Whirly Corporation’s contribution format income statement for the most recent month is shown below:
Total Per Unit
Sales (7,330 units) $ 249,220 $ 34.00
Variable expenses 139,270 19.00
Contribution margin 109,950 $ 15.00
Fixed expenses 55,100
Net operating income $ 54,850
3. Revised net operating income per month if the sales volume is 6,400 units:
Whirly Corporation’s contribution format income statement for the most recent month is shown below:
Total Per Unit
Sales (6,400 units) $ 217,600 $ 34.00
Variable expenses 121,600 19.00
Contribution margin 96,000 $ 15.00
Fixed expenses 55,100
Net operating income $ 40,900
Explanation:
a) Data and Calculations:
Whirly Corporation’s contribution format income statement for the most recent month is shown below:
Total Per Unit
Sales (7,400 units) $ 251,600 $ 34.00
Variable expenses 140,600 19.00
Contribution margin 111,000 $ 15.00
Fixed expenses 55,100
Net operating income $ 55,900
