Hill Company manufactures and sells a product called ZAP. Results of last year for the manufacture and sale of ZAP's are as follows: Sales (8,000 ZAPs at $120 each) $960,000 Less costs: Variable production costs 464,000 Sales commissions (15% of sales) 144,000 Salary of product line manager 100,000 Fixed product line advertising 160,000 Fixed manufacturing overhead 132,000 Total costs 1,000,000 Net operating loss $ (40,000)