Fry Corporation developed the following income statement using a contribution margin approach:

Fry Corporation

Projected Income Statement For the Current Year

Line Item Description Amount Amount

Sales $(6,000$ units$)$ $$288,000$

Less variable costs:

Variable manufacturing costs $$65,500$

Variable selling costs $35,000$

Total variable costs $100,500$

Contribution margin $$187,500$

Less fixed costs:

Fixed manufacturing costs $$117,000$

Fixed selling and administrative costs $42,500$

Total fixed costs $159,500$

Operating income $$28,000$

Required:

A$.$ Determine the break$-$even point in sales dollars. Round units Up to next whole unit. Use rounded amount in subsequent computations.

fill in the blank $1$ of $3$$

For B$-$C$,$ round final answer to the nearest whole dollar.

B$.$ The sales manager believed the company could increase sales by $350$ units if advertising expenditures were increased by $$22,500.$ By how much will the operating income increase or decrease if the advertising is increased as suggested?

fill in the blank $2$ of $3$$

C$.$ What is the maximum amount the company could pay for advertising if the advertising would increase sales by $350$ units?

fill in the blank $3$ of $3$$