Phoenix Companys 2017 master budget included the following fixed budget report. It is based on an expected production and sales volume of 15,000 units. PHOENIX COMPANY Fixed Budget Report For Year Ended December 31, 2017 Sales $ 3,000,000 Cost of goods sold Direct materials $ 975,000 Direct labor 225,000 Machinery repairs (variable cost) 60,000 DepreciationPlant equipment (straight-line) 315,000 Utilities ($45,000 is variable) 180,000 Plant management salaries 180,000 1,935,000 Gross profit 1,065,000 Selling expenses Packaging 75,000 Shipping 90,000 Sales salary (fixed annual amount) 235,000 400,000 General and administrative expenses Advertising expense 125,000 Salaries 241,000 Entertainment expense 85,000 451,000 Income from operations $ 214,000

3. The companys business conditions are improving. One possible result is a sales volume of 18,000 units. The company president is confident that this volume is within the relevant range of existing capacity. How much would operating income increase over the 2017 budgeted amount of $214,000 if this level is reached without increasing capacity?