Last month when Simple Creations, Inc., sold 50,000 units, total sales were P200,000, total variable expenses were P120,000 and fixed expenses were P65,000. 1. What is the company's Contribution Margin (CM) Ratio? 2. Estimate the change in the company's net operating income if it were to increase its total sales by P1,000.

Last month when Simple Creations, Inc., sold 50,000 units, total sales were P200,000, total variable expenses were P120,000 and fixed expenses were P65,000. 1. What is the company's Contribution Margin (CM) Ratio? 2. Estimate the change in the company's net operating income if it were to increase its total sales by P1,000.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 14EB: Company A has current sales of $4,000,000 and a 45% contribution margin. Its fixed costs are...

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