Sales?$110,000
Cost of goods sold? ($57,000)
Gross Profit?. $ 53,000
Operating expenses? $(38,000)
Operating Income?. $15,000
Based on an analysis of cost behavior patterns, it has been determined that the company?s contribution margin ratio is 30 percent.
A. Rearrange the above income statement to the contribution margin format.
B. If sales increase by 20 percent, what will be the firm?s operating income?
C. Calculate the amount of revenue required for chauncey?s farm to break even.