## Thursday, 1 May 2014

### Miller Company's most recent contribution format income statement is shown below:

Exercise 6-11 Using a Contribution Format Income Statement [LO1, LO4]
 Miller Company's most recent contribution format income statement is shown below:

 Total Per Unit Sales (41,000 units) \$246,000 \$6.00 Variable expenses 164,000 4.00 Contribution margin 82,000 \$2.00 Fixed expenses 40,000 Net operating income \$42,000

 Required: Prepare a new contribution format income statement under each of the following conditions (consider each case independently) (Round per unit values to 2 decimal places and the rest to the nearest dollar amount. Input all amounts as positive values. Omit the "\$" sign in your response):

 (1) The number of units sold increases by 19%.

 Total Per Unit Sales \$ \$ Variable expenses Contribution margin \$ Fixed expenses Net operating income \$

 (2) The selling price decreases by \$0.70 per unit, and the number of units sold increases by 17%.

 Total Per Unit Sales \$ \$ Variable expenses Contribution margin \$ Fixed expenses Net operating income \$

 (3) The selling price increases by \$0.30 per unit, fixed expenses increase by \$5,000, and the number of units sold decreases by 4%.

 Total Per Unit Sales \$ \$ Variable expenses Contribution margin \$ Fixed expenses Net operating income \$

 (4) The selling price increases by 10%, Variable expenses increase by 30 cents per unit, and the number of units sold decreases by 8%.

 Total Per Unit Sales \$ \$ Variable expenses Contribution margin \$ Fixed expenses Net operating income \$

Explanation:
(1) Sales (41,000 units × 1.19 = 48,790 units)
 (2) Sales (41,000 units × 1.17 = 47,970 units)

 (3) Sales (41,000 units × 0.96 = 39,360 units)

 (4) Sales (41,000 units × 0.92 = 37,720 units)