Kensington Corporation has provided the following contribution format income statement. Answer each question independently based on the original data:Sales (6,000 units)$ 210,000Variable expenses150,000Contribution margin60,000Fixed expenses40,000Net operating income$ 20,000 Required:Enter the numbers only, rounded to the nearest whole number What is the break-even point in dollar sales? Estimate how many units must be sold to achieve a target profit of $60,000. What is the margin of safety in dollars? Using the degree of operating leverage, what is the estimated percent increase in net operating income of a 25% increase in sales volume?If the variable cost per unit increases by $3, spending on advertising increases by $4,000, and unit sales increase by 550 units, what would be the estimated net operating income? (fil in spaces below for Q5)Unit contribution margin Unit sales Total Contribution margin Fixed expenses Net operating income

Since the question has multiple sub parts we will answer the first 3 sub parts for you . If need the…

Answered: break-even point

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter8: Tactical Decision-making And Relevant Analysis

Section: Chapter Questions

Problem 11MCQ: Garrett Company provided the following information: Common fixed cost totaled 46,000. Garrett...

See similar textbooks

Related questions

Question

Kensington Corporation has provided the following contribution format income statement. Answer each question independently based on the original data:

Sales (6,000 units)	$ 210,000
Variable expenses	150,000
Contribution margin	60,000
Fixed expenses	40,000
Net operating income	$ 20,000

Required:

Enter the numbers only, rounded to the nearest whole number

What is the break-even point in dollar sales?
Estimate how many units must be sold to achieve a target profit of $60,000.
What is the margin of safety in dollars?
Using the degree of operating leverage, what is the estimated percent increase in net operating income of a 25% increase in sales volume?
If the variable cost per unit increases by $3, spending on advertising increases by $4,000, and unit sales increase by 550 units, what would be the estimated net operating income? (fil in spaces below for Q5)

Unit contribution margin
Unit sales
Total Contribution margin
Fixed expenses
Net operating income

Expert Solution

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions