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Exercise 6-1 (Algo) The Effect of Changes in Sales Volume on Net Operating Income [LO6-1] Whirly Corporation's contribution format income statement for the most recent month is shown below: Per Unit $ 32.00 18.00 $14.00 Sales (7,200 units) Variable expenses Contribution margin Fixed expenses Net operating income: Total $ 230,400 129,600 100,800 54,000 $ 46,800 Required: (Consider each case independently): 1. What would be the revised net operating income per month if the sales volume increases by 40 units? 2. What would be the revised net operating income per month if the sales volume decreases by 40 units? 3. What would be the revised net operating income per month if the sales volume is 6,200 units? 1. Revised net operating income 2. Revised net operating income 3. Revised net operating income

Exercise 6-4 (Algo) Computing and Using the CM Ratio [LO6-3] Last month when Holiday Creations, Incorporated, sold 35,000 units, total sales were $140,000, total variable expenses were $102,200, and fixed expenses were $38,800. Required: 1. What is the company's contribution margin (CM) ratio? 2. What is the estimated change in the company's net operating income if it can increase sales volume by 475 units and total sales by $1,900? (Do not round intermediate calculations.) 1. Contribution margin ratio 2. Estimated change in net operating income

2 the following information applies to the questions displayed below! Data for Hermann Corporation are shown below: Peccent Selling price Variable expenses Per Unit of sales $100 100% 61 61 Contribution margin 5.39 394 Fixed expenses are $80,000 per month and the company is selling 3,700 units per month. Exercise 6-5 (Algo) Part 1 Required: 1-a. How much wil net operating income increase (decrease) per month if the monthly advertising budget increases by $8,500, the monthly sales volume increases by 100 units, and the total monthly sales increase by $10,000? 1-b. Should the advertising budget be increased? Complete this question by entering your answers in the tabs below. Reg 1A Reg 10 How much will net operating income increase (decrease) per month if the monthly advertising budget increases by $8,500, the monthly sales volume increases by 100 units, and the total monthly sales increase by $10,000? (Do not round intermediate calculations) Net openiting income Req 18 >

2 Data for Hermann Corporation are shown below: Percent Per Unit of Sales #100 1000 41 61 1.39 391 Selling price Variable expenses Contribution margin Fixed expenses are $80,000 per month and the company is selling 3.700 units per month. Exercise 6-5 (Algo) Part 2 2-a. Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher-quality components that increase the variable expense by $3 per unit and increase unit sales by 15% 2-b. Should the higher-quality components be used? Complete this question by entering your answers in the tabs below. Reg A Reg 28 Refer to the original data. How much will net operating income increase (decrease) per month if the company uses higher- quality components that increase the variable expense by $3 per unit and increase unit sales by 15%. 42A Req 28 >

Exercise 6-6 (Algo) Break-Even Analysis [LO6-5] Mauro Products distributes a single product, a woven basket whose selling price is $25 per unit and whose variable expense is $20 per unit. The company's monthly fixed expense is $13,500. Required: 1. Calculate the company's break-even point in unit sales. 2. Calculate the company's break-even point in dollar sales. (Do not round intermediate calculations.) 3. If the company's fixed expenses increase by $600, what would become the new break-even point in unit sales? In dollar sales? (Do not round intermediate calculations.) 1. Break-even point in unit sales. 2. Break-even point in dollar sales 3. Break-even point in unit sales 3. Break-even point in dollar sales baskets baskets

Exercise 6-7 (Algo) Target Profit Analysis [LO6-6] Lin Corporation has a single product whose selling price is $134 per unit and whose variable expense is $67 per unit. The company's monthly fixed expense is $32.300. Required: 1 Calculate the unit sales needed to attain a target profit of $7.900. (Do not round intermediate calculations.) 2. Calculate the dollar sales needed to attain a target profit of $8,600. (Round your intermediate calculations to the nearest whole number) 1. Units sales to attain target profit 2. Dollar sales to attain target proft Check my work

Graded Homework Exercise 6-8 (Algo) Compute the Margin of Safety (L06-7] Molander Corporation is a distributor of a sun umbrella used at resort hotels. Data concerning the next month's budget appear below: Selling price per unit Variable expense per unit Fived expense per month hit sans per month 5:23 $11 1 Margin of safety (in dollar) 2. Margin of safety percentage San $ 13,920 1,020 Required: 1. What is the company's margin of safety? (Do not round intermediate calculations.) 2. What is the company's margin of safety as a percentage of its sales? (Round your percentage answer to 2 decimal places (.e. 1234 should be entered as 12.34)) Check my work