EXERCISE 6-10 (20 MINUTES) TOTAL PER UNIT

4. Sales (20,000 units × 0.90 = 18,000 units) ... $302,400 $16.80

Less variable expenses ... 172,800 9.60

Contribution margin ... 129,600 $ 7.20

Less fixed expenses... 70,000

Net operating income ... $ 59,600