Assume that you are part of the accounting team for Epstein Productions. The company has only one product that sells for $80 per unit. Epstein estimates total fixed costs to be $3,800. Epstein estimates direct materials cost of $24.00 per unit, direct labor costs of $30.00 per unit, and variable overhead costs of $6.00 per unit. The CEO would like to see what the gross margin and operating income will be if 300 units are sold in the next period. Prepare a contribution margin income statement.

Epstein Productions Contribution Margin Income Statement Sales 24,000 Less: Variable costs 18,000 Contribution margin 6,000 Less: Fixed costs 3,700 X Operating income 2,300 XContribution Margin per Unit = 80 60 = 20 Contribution Margin Ratio = 20 25 80 Now complete the formulas for (1) the break-even point in sales dollars and (2) the units sold at the break-even point. To calculate this, divide the break-even point in sales dollars by the unit selling price. Break-Even Point in Sales Dollars = 6,000 24,000 25 Units Sold at Break-Even Point units Assume that the number of units that Epstein sold exceeded the break-even point by one (1)