Zucca Company has a contribution margin per unit of $54. If 6,000 more items are sold, and fixed expenses remain the same, the net change in operating income will be
A) $(324,000).
B) $324,000.
C) $111.
D) $6,000.

Question

Quizplus · Accepted Answer

To calculate the net change in operating income, we need to use the following formula:

Net Change in Operating Income = Contribution Margin x Change in Sales - Fixed Expenses

Since fixed expenses remain the same, we can ignore them in this calculation.

So, the net change in operating income will be:

Net Change in Operating Income = Contribution Margin x Change in Sales
Net Change in Operating Income = $54 x 6,000
Net Change in Operating Income = $324,000

Therefore, the correct answer is B, $324,000.

Zucca Company Has a Contribution Margin Per Unit of $54