Big island coffee co. Produced and sold 120,000 units last year.

Big Island Coffee Co. produced and sold 120,000 units last year. Per unit revenue and costs were as follows: Revenue $35.00 Cost of Goods Sold: Direct Materials $20.00 Direct Labour 3.00 Variable Manufacturing Overhead 2.00 Fixed Manufacturing Overhead 1.00 Total Cost of Goods Sold 26.00 Gross Margin $9.00 Selling and Administrative Costs: Sales Commissions (10% of sales) $3.50 Administrative Salaries 6.00 Total Selling and Administrative 9.50 Operating Income