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Question: phoenix companys 2015 master budget included the following fixed budget...

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Phoenix Company’s 2015 master budget included the following fixed budget report. It is based on an expected production and sales volume of 15,000 units.

The companys business conditions are improving. One possible result is a sales volume of approximately 18,000 units. The company president is confident that this volume is within the relevant range of existing capacity. How much would operating income increase over the 2015 budgeted amount of $220,000 if this level is reached without increasing capacity? PHOENIX COMPANY Forecasted Contribution Margin Income Statement For Year Ended December 31, 2015 15,000 18,000 Sales (in units) Contribution margin (per unit) Contribution margin Fixed costs Expected increase in operating income

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