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Northwood Company manufactures basketballs. The company has a ball that sells for $ 2 5 . At present, the ball is manufactured in a small

Northwood Company manufactures basketballs. The company has a ball that sells for $25. At present, the ball is manufactured in a small plant that relies heavily on direct labor workers. Thus, variable expenses are high, totaling $15.00 per ball, of which 60% is direct labor cost.
1.38 Last year, the company sold 34,250 of these balls, with the following results: points
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Sales balls)
Variable expenses
Contribution margin
Fixed expenses
Net operating income,
\table[[$856,250
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