Andretti Company has a single product called a Dak. The company normally produces and sells 86,000 Daks each year at a selling price of $48 per unit. The company's unit costs at this level of activity are given below: Direct materials 9.50 Direct labor 11.00 Variable manufacturing overhead 2.60 Fixed manufacturing overhead 5.00 ($430,000 total) Variable selling expenses 2.70 Fixed selling expenses 5.50 ($473,000 total) 36.30 Total cost per unit A number of questions relating to the production and sale of Daks follow. Each question is independent. Required 1-a. Assume that Andretti Company has sufficient capacity to produce 116,100 Daks each year without any increase in fixed manufacturing overhead costs. The company could increase its sales by 35% above the present 86,000 units each year if it were willing to increase the fixed selling expenses by $130,000. Calculate the incremental net operating income. (Round all dollar amounts to 2 decimal places Increased sales in units 30,100 Contribution margin per unit 22.20 668,220.00 Incremental contribution margin 130,000.00 Less added fixed selling expense Incremental net operating income 538,220.00