If the company sells 9,700 units, its net operating income should be closest to:

A) $57,000
B) $55,000
C) $55,573
D) $58,500

Question

If the company sells 9,700 units, its net operating income should be closest to:A) $57,000B) $55,000C) $55,573D) $58,500

Skylar Tackett · Accepted Answer

Final Answer : A, Explanation :  Selling price per unit = $336,000 ÷ 9,600 units = $35 per unitVariable expense per unit = $144,000 ÷ 9,600 units = $15 per unitUnit CM = $35 per unit - $15 per unit = $20 per unitProfit = Unit CM × Q - Fixed expenses= $20 per unit × 9,700 units - $137,000 = $194,000 - $137,000 = $57,000Reference: CHO6-Ref3Lister Corporation has provided the following contribution format income statement.All questions concern situations that are within the relevant range.

If the company sells 9,700 units, its net operating income should be closest to:

A) $57,000
B) $55,000
C) $55,573
D) $58,500

Definitions

Learning Objectives

Learning Objectives

Related questions