EXERCISE 6-10 (20 MINUTES) TOTAL PER UNIT

1. Sales (20,000 units × 1.15 = 23,000 units) ... $345,000 $ 15.00

Less variable expenses ... 207,000 9.00

Contribution margin ... 138,000 $ 6.00

Less fixed expenses... 70,000

Net operating income ... $ 68,000