If sales decrease by 500 units, by how much would fixed expenses have to be reduced to maintain…
Given the following data:
Total
Per Unit
Sales
$30,000
$10
Less variable expenses
18,000
6
Contribution margin
12,000
$ 4
Less fixed expenses
9,000
Net operating income
$ 3,000
If sales decrease by 500 units, by how much would fixed expenses have to be reduced to maintain current net operating income?
A) $5,000
B) $3,000
C) $1,500
D) $2,000