Fry Corporation developed the following income statement using a contribution margin approach:
Fry Corporation
Projected Income Statement For the Current Year
Line Item Description Amount Amount
Sales units $
Less variable costs:
Variable manufacturing costs $
Variable selling costs
Total variable costs
Contribution margin $
Less fixed costs:
Fixed manufacturing costs $
Fixed selling and administrative costs
Total fixed costs
Operating income $
Required:
A Determine the breakeven point in sales dollars. Round units Up to next whole unit. Use rounded amount in subsequent computations.
fill in the blank of $
For BC round final answer to the nearest whole dollar.
B The sales manager believed the company could increase sales by units if advertising expenditures were increased by $ By how much will the operating income increase or decrease if the advertising is increased as suggested?
fill in the blank of $
C What is the maximum amount the company could pay for advertising if the advertising would increase sales by units?
fill in the blank of $
