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Rovinsky Corporation, a company that produces and sells a single product, has provided its contribution format income statement for November. Sales (8,100 units) $ 453,600 Variable expenses 291,600 Contribution margin 162,000 Fixed expenses 103,500 Net operating income $ 58,500 If the company sells 8,000 units, its net operating income should be closest to: ____________(Do not round intermediate calculations.)

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hyderali230

Answer:

If the company sells 8,000 units, its net operating income should be $56,500.

Explanation:

If Company sells 8,00 units

Sales (8,000 x 56 )                            $448,000

Variable expenses (8,000 x 36 ) =  ($288,000)

Contribution margin                           $160,000

Fixed expenses                                  ($103,500)

Net operating income                        $56,500

Working:

Number of Units = 8,100 units

Sales  price  = $453,600 / 8,100 = $56

Variable expenses 291,600 / 8,100 = $36

Fixed expenses = $103,500

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