Question

Gonyo Inc., which produces and sells a single product, has provided the following contribution format income statement for December appears below:

Sales (5,000 units) $ 330,000
Variable expenses 175,000
Contribution margin 155,000
Fixed expenses 104,900
Net operating income $50,100
Required:
Redo the company's contribution format income statement assuming that the company sells 5,200 units.
Net Operating Income _______.

Answer 1

Net income= 56,300

Step-by-step explanation:

Giving the following information:

Fixed expenses 104,900

First, we need to determine unitary values:

Selling price= 330,000/5,000= $66

Unitary variable expenses= 175,000/5,000= $35

Now, we can redo the contribution margin income statement for 5,200 units:

Sales= 66*5,200= 343,200

Total variable cost= 35*5,200= (182,000)

Total contribution margin= 161,200

Fixed costs= (104,900)

Net income= 56,300