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Find how much will net operating income increase

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Reference no: EM132510408

Feather Friends, Inc., distributes a high-quality wooden birdhouse that sells for $80 per unit. Variable expenses are $40.00 per unit, and fixed expenses total $180,000 per year.

Its operating results for last year were as follows:

Sales $ 2,080,000

Variable expenses 1,040,000

Contribution margin 1,040,000

Fixed expenses 180,000

Net operating income $ 860,000

Question 1: If this year's sales increase by $57,000 and fixed expenses do not change, how much will net operating income increase?

Reference no: EM132510408

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