Question

Shown here is an income statement inthe traditional format for a firm with a sales volume of 20,000units:

Revenues	$	160,000
Cost of goodssold ($16,000 + $3.20/unit)		80,000
Grossprofit	$	80,000
Operatingexpenses:
Selling ($4,500+ $1.40/unit)		32,500
Administration($7,500 + $1.00/unit)		27,500
Operatingincome	$	20,000

Requirement 1:

Prepare an income statement in thecontribution margin format. (Omitthe "$" sign in your response.)

		$
Variableexpenses:
	$
Total variableexpenses
Contributionmargin		$
Fixedexpenses:
	$
Total fixedexpenses
		$

Requirement 2:

Calculate the contribution marginper unit and the contribution margin ratio. (Round your answers to 1 decimal place. Omit the"$" and "%" signs in your response.)

Contribution margin per unit	$
Contributionmargin ratio	%

Requirement 3:
(a)	Calculate the firm's operatingincome (or loss) if the volume changed from 20,000 units to 25,000units. (Input the amount aspositive value. Omit the "$" sign in your response.)

operating income

$

(b)	Calculate the firm's operatingincome (or loss) if the volume changed from 20,000 units to 11,000units. (Input the amount aspositive value. Omit the "$" sign in your response.)

operating loss

$

Requirement 4:
Refer to your answer to requirement 1 when total revenues were$160,000.
(a)	Calculate the firm's operatingincome (or loss) if unit selling price and variable expenses do notchange, and total revenues increase by $18,000. (Input the amount as positive value. Omit the "$"sign in your response.)

operating income

$

(b)	Calculate the firm's operatingincome (or loss) if unit selling price and variable expenses do notchange, and total revenues decrease by $12,000. (Input the amount as positive value. Omit the "$"sign in your response.)

operating income

$