Income Statement Items; Expected Net Income. Sellco Sales Company sold 60,000 units of product for $5.00 per unit in 20x2. Its variable costs per unit were $3.00; its fixed costs per unit. $1.50.

a. Using the contribution margin approach, determine the amount of net income for 20x2.

b. The company is considering a proposal to increase sales by 20,000 units by increasing advertising by $20,000 in 20x3. Assuming no change in other fixed costs, determine the amount of expected net income for 20x3 under the proposal.