Rovinsky Corporation, a company that produces and sells a single product, has provided its contribution format income statement for November. If the company sells 5,300 units, its net operating income should be closest to:

A) $24,600
B) $2,200
C) $22,874
D) $15,400

Question

Rovinsky Corporation, a company that produces and sells a single product, has provided its contribution format income statement for November.

If the company sells 5,300 units, its net operating income should be closest to:

A) $24,600
B) $2,200
C) $22,874
D) $15,400

Jimmy Neutron · Accepted Answer

Final Answer : D, Explanation :  Selling price per unit = Sales ÷ Quantity sold= $319,200 ÷ 5,700 units = $56 per unitVariable expenses per unit = Variable expenses ÷ Quantity sold= $188,100 ÷ 5,700 units = $33 per unitUnit CM = Selling price per unit - Variable expenses per unit= $56 per unit - $33 per unit = $23 per unitProfit = (Unit CM × Q)- Fixed expenses= ($23 per unit × 5,300 units)- $106,500 = $121,900 - $106,500 = $15,400

Rovinsky Corporation, a company that produces and sells a single product, has provided its contribution format income statement for November. If the company sells 5,300 units, its net operating income should be closest to:

A) $24,600
B) $2,200
C) $22,874
D) $15,400

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Rovinsky Corporation, a company that produces and sells a single product, has provided its contribution format income statement for November. If the company sells 5,300 units, its net operating income should be closest to:A) $24,600B) $2,200C) $22,874D) $15,400

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Learning Objectives

Learning Objectives

Related questions

Rovinsky Corporation, a company that produces and sells a single product, has provided its contribution format income statement for November. If the company sells 5,300 units, its net operating income should be closest to:

A) $24,600
B) $2,200
C) $22,874
D) $15,400