Stylish Sitting is a retailer of office chairs located in San Francisco, California. Due to increased market competition, the CFO of Stylish Sitting has grown worried about the firm's upcoming income stream. The CFO asked you to use the company financial information provided below. Sales price$76.00 Per-unit variable costs: Invoice cost 40.25 Sales commissions 17.25 Total per-unit variable costs$57.50 Total annual fixed costs: Advertising$54,300 Rent 76,600 Salaries 224,600 Total annual fixed costs$355,500 If 38,500 office chairs were sold, Stylish Sitting's operating income (πB) would be: (Do not round intermediate calculations.)

Surplus or deficit in the income statement is the excess or shortfall of operating income of the…

Answered: Stylish Sitting is a retailer of office…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter3: Cost-volume-profit Analysis

Section: Chapter Questions

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Stylish Sitting is a retailer of office chairs located in San Francisco, California. Due to increased market competition, the CFO of Stylish Sitting has grown worried about the firm's upcoming income stream. The CFO asked you to use the company financial information provided below.


Sales price	$	76.00
Per-unit variable costs:
Invoice cost		40.25
Sales commissions		17.25
Total per-unit variable costs	$	57.50
Total annual fixed costs:
Advertising	$	54,300
Rent		76,600
Salaries		224,600
Total annual fixed costs	$	355,500

If 38,500 office chairs were sold, Stylish Sitting's operating income (π_B) would be: (Do not round intermediate calculations.)

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