1. Kramer Enterprises reports year-end information as follows:

Sales in units: 304,000

Sales: $1,824,000

Variable Costs: 1,216,000

Contribution Margin: 608,000

Fixed Costs 494,000

Operating Income: $114,000

Kramer is developing next years budget. Next year, the company is planning to decrease selling prices by 10%, and as a result, expects an increase in sales volume of 15%. All other operating expenses are expected to remain constant.

Calculate Kramers expected operating income for next year