Example: Skateboard Inc. manufactures and sells skateboards. In the most recent month, they sold 10,000 skateboards. Here is their income statement. Sales Variable Expenses Contribution Margin Fixed Expenses Operating Income # of units 10,000 10,000 10,000 per unit Total $40.00 $400,000 ($28.00) ($280,000) $12.00 $120,000 ($72,000) $48,000 1. The marketing manager wants to spend $60,000 on advertising. She believes that this will increase monthly sales by 40%. Complete the problem below. # of units per unit Total Sales $10.00 Variable Expenses ($28.00) Contribution Margin 1 $12.00 Fixed Expenses Operating Income Should they do it? Answer-make sure you explain your answer thoroughly