Answer:
$204,000
Explanation:
Given that,
Total Sales = $ 340,000
Variable expenses = $170,000
Contribution margin = $170,000
Fixed expenses = $108,000
Net operating income = $ 62,000
Contribution margin ratio:
= Contribution margin ÷ Sales
= $170,000 ÷ $ 340,000
= 0.5 or 50%
If sales volume increases by 30%,
Revised sales:
= Total sales + 20% of Total sales
= $340,000 + (0.2 × $340,000)
= $340,000 + $68,000
= $408,000
Revised contribution margin:
= Revised sales × Contribution margin ratio
= $408,000 × 50%
= $204,000
