part a) The break-even point in sales dollars is:

a. $731,250

b. $676,000

c. $675,000

d. $720,000

part b) If the company desires a net operating income of $20,000, the number of units needed to be sold is:

a. 28,500 units

b. 31,750 units

c. 31,000 units

d. 26,500 units

part c) The sales manager is convinced that a $60,000 expenditure on advertising will increase unit sales by 50% without any other increase in fixed expenses. If the sales manager is correct, the company's net operating income would increase by:

a. $44,000

b. $30,000

c. $34,000

d. $49,000

Drake Company's contribution format income statement for the most recent year appears below Sales (26,000 units $650,000 Variable expenses 442,000 Contribution margin. 208,000 Fixed expenses.................. 234,000 Net operating loss 26,000