What would be the company expected operating income

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Reference no: EM132960121

BPN Company's most recent monthly contribution format income statement is given below:

Sales $160,000

Less: variable expenses 100,000

Contribution margin 60,000

Less: fixed expenses 63,000

Operating income (3,000)

The company sells its only product for $10 per unit. There were no beginning or ending inventories.

Required:

Problem a. What is the company's contribution margin ratio?

Problem b. What are total sales in dollars at the break-even point?

Problem c. What are total variable expenses at the break-even point?

Problem d. If unit sales were increased by 10% and fixed expenses were reduced by $2,000, what would be the company's expected operating income?

Reference no: EM132960121

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