### what is the contribution margin per unit 2 what is the contribution margin ratio 681806

(Answer each question independently and always refer to the original data unless instructed otherwise.) 1. What is the contribution margin per unit? 2. What is the contribution margin ratio? 3. What is the variable expense ratio? 4. If sales increase to 1.001 units, what would be the increase in net operating income? 5. If sales decline to 900 units. what would he the net operating income? 6. If the selling price increases by $2 per unit and the sales volume decrea.ses by 100 units, what would be the net operating income? 7. If the variable cost per unit increases by SI, spending on advertising increases by 51.500. and unit sales increase by 250 units, what would he the net operating income? 8. What is the break even point in unit sales? 9. What is the break even point in sales dollars? 10. How many units must be sold to achieve a target profit of $5.01)0? 11. What is the margin of safety in dollars? What is the margin of safety percentage? 12. What is the degree of operating leverage? 13. Using the degree of operating leverage, what is the estimated percent increase in net operating income of a 5% increase in sales? 14. Assume that the amounts of the company’s total variable expenses and total fixekexpensts were reversed In other words. assume that the total variable expenses arc S6,000 and the total fixed expenses arc 512.000. Under this scenario and assuming that total sales remain the same. what is the degree of operating leverage? 15. Using the degree of operating leverage that you computed in the previous question, what is the estimated percent increase in net operating income of a 5% increase in sales?

The Foundational 15 Sales Contribution Margin Net operating income Units 3 Fixed Expenses Variable expenses 1. Total contribution margin Total units sold Contribution margin per unit units per unit 2. Total contribution margin Total sales Contribution margin ratio Total variable expenses Variable expense ratio 4 Increase in unit sales Increase in net operating income unit 5. Contribution margin Fixed expenses Per unit 6. 7 8 Profit = Unit CM X Q Fixed expenses 9. Profit CM ration X Sales Fixed Expenses 10 11 Break even sales at units Margin of safety (in dollars) Margin of safety percentage % per unit $ Units sold 12 Degree of operating leverage 13 % increase in sales % increase in net operating income 14 15 $20,000.00 1.00 $20.00 1000.00 $12,000.00 0.60 $12.00 $8,000.00 0.40 $8.00 $6,000.00 $2,000.00 The Foundational 15 Sales Contribution Margin Net operating income Units 3 Fixed Expenses Variable expenses 1. Total contribution margin Total units sold Contribution margin per unit units per unit 2. Total contribution margin Total sales Contribution margin ratio Total variable expenses Variable expense ratio 4 Increase in unit sales Increase in net operating income unit 5. Contribution margin Fixed expenses Per unit 6. 7 8 Profit = Unit CM X Q Fixed expenses 9. Profit CM ration X Sales Fixed Expenses 10 11 Break even sales at units Margin of safety (in dollars) Margin of safety percentage % per unit $ Units sold 12 Degree of operating leverage 13 % increase in sales % increase in net operating income 14 15 $20,000.00 1.00 $20.00 1000.00 $12,000.00 0.60 $12.00 $8,000.00 0.40 $8.00 $6,000.00 $2,000.00