EXERCISE 6-8 (20 MINUTES)

3. The new income statement reflecting the change in sales would be:

of Sales

Amount Percent

Sales... $84,000 100%

Less variable expenses ... 33,600 40%

Contribution margin ... 50,400 60%

Less fixed expenses... 38,000

Net operating income ... $12,400

Net operating income reflecting change in sales ... $12,400

Original net operating income ... $10,000

Percent change in net operating income ... 24%