Answer:
The question is incomplete, I found a possible match to the complete question:
Rovinsky Corporation, a company that produces and sells a single product, has provided its contribution format income statement for November.
sales (5,700 units) $ 319,200
Variable expenses 188,100
Contribution margin 131,100
Fixed expenses 106,500
Net operating income $ 24,600
If the company sells 5,300 units, its net operating income should be closest to:
a. $24,600
b. $2,200
c. $22,874
d. $15,400
The correct answer is:
$15,400 (d.)
Explanation:
In order to solve this, we have to find the unit sales for the product, then use that to calculate for the required 5,300 units. This is done as follows:
we are given that:
5,700 units = 319,200
∴ 1 unit = 319,200 ÷ 5,700 = $56
∴ sales = $56 per unit
Hence 5,300 units = 56 × 5300 = $296,800
For the variable expenses:
5,700 units = $188,100
∴ 1 unit = 188,100 ÷ 5700 =$33
∴ 5,300 units = 33 × 5300 = $174,900
Fixed expenses = $106,500 (remains the same irrespective of number of units)
Now let us calculate the net operating income as follows:
Net operating income = Sales - variable expenses - fixed expenses
Net operating income = 296,800 - 174,900 - 106,500 = $15,400
Therefore if 5,300 units are sold, net operating income = $15,400
