International Data Systems' information on revenue and costs is relevant only up to a sales volume of 124,000 units. After 124,000 units, the market becomes saturated and the price per unit falls from $16.00 to $9.80. Also, there are cost overruns at a production volume of over 124,000 units, and variable cost per unit goes up from $8.00 to $8.50. Fixed costs remain the same at $74,000.

a.Compute operating income at 124,000 units.

b. Compute operating income at 224,000 units