Laraia Corporation has provided the following contribution format income statement. All questions concern situations that...
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Accounting
Laraia Corporation has provided the following contribution format income statement. All questions concern situations that are within the relevant range.
Sales (8,000 units)
$480,000
Variable expenses
336,000
Contribution margin
144,000
Fixed expenses
142,200
Net operating income
$1,800
Required:
e. What is the break-even point in dollar sales?
f. Estimate how many units must be sold to achieve a target profit of $50,400.
g. What is the margin of safety percentage?
h. Using the degree of operating leverage, what is the estimated percent increase in net operating income of a 15% increase in sales?
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