Polaski Company manufactures and sells a single product called a Ret. Operating at capacity, the company can produce and sell 36,000 Rets per year. Costs associated with this level of production and sales are given below:

UnitTotalDirect materials$25$900,000Direct labor10360,000Variable manufacturing overhead3108,000Fixed manufacturing overhead7252,000Variable selling expense4144,000Fixed selling expense6216,000Total cost$55$1,980,000

The Rets normally sell for $60 each. Fixed manufacturing overhead is $252,000 per year within the range of 30,000 through 36,000 Rets per year.