Break-Even Sales Under Present and Proposed Conditions Kearney Company, operating at full capacity, sold 171,200 units at a price of $90 per unit during 2015. Its income statement for 2015 is as follows: Sales Cost of goods sold Gross profit Expenses: Selling expenses $2,730,000 Administrative expenses 1,650,000 Total expenses Operating Income $15,408,000 (5,460,000) $9,948,000 (4,380,000) $5,568,000 The division of costs between fixed and variable is as follows: Fixed Variable Cost of good sold 40% 60% Selling expenses 50% 50% Administrative expenses 70% 30%