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cupoosta [38]
3 years ago
12

Menlove Corporation has provided the following cost data for last year when 100,000 units were produced and sold:

Business
1 answer:
Nezavi [6.7K]3 years ago
3 0

Answer:

Net operating income= $405,000

Explanation:

<u>First, we need to calculate the unitary variable cost:</u>

Total variable cost= 650,000 - 100,000 - 100,000= $450,000

Unitary variable cost= 450,000 / 100,000

Unitary variable cost= $4.5

Total fixed cost= 100,000 + 100,000= $200,000

<u>Now, the net operating income for 110,000 units:</u>

<u />

Sales= 10*110,000= 1,100,000

Total variable cost= 110,000*4.5= (495,000)

Total contribution margin= 605,000

Total fixed cost= 200,000

Net operating income= $405,000

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