Swifty Corporation produces only one product Monthly fixed e

Swifty Corporation produces only one product. Monthly fixed expenses are $12000, monthly unit sales are 5000, and the unit contribution margin is $10. How much is monthly net income?

Solution

Answer

38000

total sales = 5000 units

total contribution = sales * contribution per unit

= 5000 * 10

= 50000

net income = total contribution - fixed expenses

= 50000 - 12000

= 38000