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Operating income change

4. The contribution margin ratio is _________.
the same as the variable cost ratio
the same as profit
the portion of equity contributed by the stockholders
the same as the profit-volume ratio

5. Halter Inc.'s unit selling price is $70, the unit variable costs are $45, fixed costs are $150,000, and current sales are 10,000 units. How much will operating income change if sales increase by 5,000 units?
$125,000 decrease
$175,000 increase
$75,000 increase
$125,000 increase

6. If fixed costs are $450,000, the unit selling price is $75, and the unit variable costs are $50, what are the old and new break-even sales (units) if the unit selling price increases by $5?
6,000 units and 5,250 units
18,000 units and 6,000 units
18,000 units and 15,000 units
9,000 units and 15,000 units

Solution Preview

4. The contribution margin ratio is _________.

the same as the profit-volume ratio

5. Halter Inc.'s unit selling price is $70, the unit variable costs are $45, fixed costs are $150,000, and current sales ...

Solution Summary

Response describes the steps to calculate the Operating income change

$2.19