Respuesta :
Answer:
Decreased of $1,700
Explanation:
Sales (8,000 units × $140, 8,100 units ×$140)
$1,120,000 $1,134,000
Variable expenses
(8,000 units × 28, 8,100 units ×$37)
$224,000, $299,700
Contribution margin
$896,000, $834,300
Fixed expenses
$720,000, $660,000
Net operating income
$176,000, $174,300
Decreased in net operating income
$176,000-$174,000= $1,700
Therefore the overall effect on the company's monthly net operating income of this change is that net operating income will decrease by $1,700
Answer:
Additional operating expense will be $12,900
The 100 units contribution per unit will also be considered in arriving at the net impact on Operating Income for the month.
Explanation:
When the Business decides to introduce sales men commission of $9 for every unit sold, note; the Fixed expense will remain unchanged.
Now let's review the elements of the income statement that will change as a result of this introduction.
Changes to Income Statement.
Add savings in Salaries of Salesmen = $60,000
Deduct commission on sales ($9 x 8,100) = 72,900
Net changes to company operating Expense = $12,900
What we have not been told is how much is the Average Contribution per unit of item sold. It is when we factor this contribution per Unit x the 100 units additional sales that we will safely conclude how much of the additional expense of $12,900 we would have covered or not.
