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Omar Industries manufactures two products: Regular and Super. The results of operations for 20x1 follow. Regular Super Total Units 15,000 3,000 18,000 Sales revenue $

Omar Industries manufactures two products: Regular and Super. The results of operations for 20x1 follow.

Regular

Super

Total

Units

15,000

3,000

18,000

Sales revenue

$

300,000

$

660,000

$

960,000

Less: Cost of goods sold

228,000

360,000

588,000

Gross Margin

$

72,000

$

300,000

$

372,000

Less: Selling expenses

72,000

140,000

212,000

Operating income (loss)

$

0

$

160,000

$

160,000

Fixed manufacturing costs included in cost of goods sold amount to $3 per unit for Regular and $20 per unit for Super. Variable selling expenses are $4 per unit for Regular and $20 per unit for Super; remaining selling amounts are fixed. If Omar Industries eliminates Regular and uses the available capacity to produce and sell an additional 1,300 units of Super, what would be the impact on operating income?

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