Question

Rovinsky Corporation, a company that produces and sells a single product, has provided its contribution format income statement for November. Sales (6,300 units) $ 415,800 Variable expenses 289,800 Contribution margin 126,000 Fixed expenses 103,500 Net operating income $ 22,500 If the company sells 6,200 units, its net operating income should be closest to g

Answer 1

Net operating income= $20,500

Step-by-step explanation:

Giving the following information:

Sales (6,300 units) $ 415,800

Variable expenses 289,800

Contribution margin 126,000

Fixed expenses 103,500

First, we need to calculate the unitary contribution margin:

Unitary contribution margin= 126,000/6,300= $20

Now, for 6,200 units:

Total contribution margin= (20*6,200)= 124,000

Fixed expenses= (103,500)

Net operating income= $20,500