Reference no: EM13987417

Oslo Company prepared the following contribution format income statement based on a sales volume of 1,000 units (the relevant range of production is 500 units to 1,500 units):

1. What is the contribution margin per unit? (round answer 2 decimal places)

2. What is the contribution margin ratio? (round percentage 2 decimal places)

3. What is the variable expense ratio?

4. If sales increase to 1,001 units, what would be the increase in net operation income? (round answer to 2 decimal places)

5. If sales decline to 900 units, what would be the net operating income? (do not round intermediate calculations)

6. If the selling price increases by $2.10 per unit and the sales volume decreases by 100 units, what would be the net operating income? (do not round intermediate calculations)

7. If the variable cost per unit increases by $1.10, spending on advertising increases by $1,600, and unit sales increase by 250 units, what would be the net operating income? (do not round intermediate calculations) 

8. What is the break-even point in unit sales? (do not round intermediate calculations)

9. What is the break-even point in dollar sales? (round intermediate calculations to 4 decimal places and to nearest dollar amount)

10. How many units must be sold to achieve a target profit of $6,426? (do not round intermediate calculations)

11a. What is the margin of safety in dollars? (do not round intermediate calculations)
11b. What is the margin of safety percentage? (round final answer to nearest whole percentage) 

12. What is the degree of operating leverage? (round answer 2 decimal places)

13. Using the degree of operating leverage, what is the estimated percent increase in net operating income of a 3% increase in sales? Do not round intermediate calculations. Round your percentage answer to 2 decimal places (i.e .1234 should be entered as 12.34)

14. Assume that the amounts of the company's total variable expenses and total fixed expenses were reversed. In other words, assume that the total variable expenses are $7,548 and the total fixed expenses are $13,100. Under this scenario and assuming that total sales remain the same, what is the degree of operating leverage? (Round your answer to 2 decimal places.)

15. Assume that the amounts of the company's total variable expenses and total fixed expenses were reversed. In other words, assume that the total variable expenses are $7,548 and the total fixed expenses are $13,100. Given this scenario, and assuming that total sales remain the same, calculate the degree of operating leverage. Using the calculated degree of operating leverage, what is the estimated percent increase in net operating income of a 3% increase in sales? Do not round intermediate calculations. Round your percentage answer to 2 decimal places (i.e .1234 should be entered as 12.34).