A manufacturer's contribution margin income statement for the year follows.
Prepare contribution margin income statements for each of the three separate
cases below. (Click on the Part 1, Part 2 and Part 3 Tabs below.)
Sales (12,000 units \times $11 per unit)
$132,000
Variable costs (12,000 units \times $6 per unit)
72,000
Contribution margin (12,000 units \times $5 per unit)
60,000
Fixed costs
44,000
Income
$16,000
Units sold
12,000
Selling price per unit
$11
Variable cost per unit
$6
Required:
1. The 12,000 units sold and produced increases to 12,500 units and fixed
costs increase by $5,900.
2. Unit selling price decreases by 5% and units sold and produced
increase by 7%. Hint: A unit increase has both a sales and costs impact.
3. Fixed costs increase by $20,900, variable costs per unit decrease by $2,
and units sold and produced increase by 600.
